Chinese Car Factories Reopen As Maruti, Hyundai, Tata & Others Halt Production in India

World’s second-largest economy, China, is on its way to recovery. Factories have resumed production and employees have gone back to manning their stations. Even the demand for items (other than household supplies) has returned, hinting at a recovery of all market sectors, especially the auto sector. Even in the Wuhan, the epicentre of the pandemic outbreak, normalcy is slowly being restored. Auto manufacturers have already begun manufacturing in the majority of their China-based plants, in order to meet the global fall in supply.

Car companies resume production in China

Tesla is leading other automakers in terms of recovery after the end of the quarantine period. The US-based EV manufacturer has surprisingly managed to surpass its previous production capacity, with over 3000 units being manufactured every week now. Volkswagen, Toyota, SIAC (MG’s parent company), Honda, and Nissan, have also resumed work, gradually rising towards full capacity. 

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China’s recovery comes in as a sigh of relief to coronavirus-struck areas, like India, Canada, US, Mexico, and Europe. As the global death toll from Covid-19 crosses 13,000, all of these places remain firmly in lockdown for an indefinite period of time. Carmakers in India have completely halted production, fearing for the safety of the employees. A majority of buyers, who have recently booked a new car, are currently sitting on delays in the delivery. New buyers have completely shelved their plans for a new car purchase, thus bringing both the supply and demand in the auto industry down.

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Maruti Suzuki, the biggest car manufacturer in India, has completely shut operations in Haryana. Mahindra & Mahindra and Volkswagen have followed suit with their plants in Maharashtra, the state with the highest number of novel coronavirus cases. Hyundai has also suspended production at its Chennai facility.

"A lockdown over the next few weeks will help flatten the curve and moderate the peak pressure on medical care"

Anand Mahindra, Chairman, Mahindra group

Anand Mahindra had recently announced that he will be donating to a relief fund for small businesses affected by novel coronavirus in the country, and Mahindra club resorts will be available as temporary healthcare centres for affected patients. Installation of ventilators is already underway (Read all about that).

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It’s hard to predict how long the lockdown period in India will last, or if the situation will improve or worsen in the immediate future. The auto sector was already going through turbulent times before the pandemic. However, it wouldn’t be a stretch to assume that a recovery, similar to China, will soon be underway.

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