AutoBeta(AutoBeta.net)02/15 Report--

Due to the spread of the novel coronavirus epidemic, more and more automobile companies around the world are facing a shortage of spare parts and suspending production. According to foreign media reports, the American Federation of Industrial Trade unions in Flint, Michigan, recently issued a warning that the novel coronavirus epidemic in China has led to a shortage of some spare parts, which may cause production disruptions at GM's three factories in the United States.

According to media reports, the three affected plants are Flint Assembly Plant (Flint Assembly), which makes heavy pickups, Fort Wayne, Indiana (Fort Wayne Assembly), which makes light pickups, and Arlington, Texas (Arlington Assembly), which produces large SUV models.

While commenting on the report, GM spokesman David Barnas said the company does not expect parts shortages caused by the COVID-19 outbreak to lead to production at factories in Michigan, Indiana and Texas for the time being. However, in a statement, it said, "the situation is still unstable and some GM suppliers have begun to restart parts production in China, so we will continue to monitor our supply chain and maintain close communication. Trying to reduce the risk of production in North America."

In fact, GM's three plants produce the best-selling and most profitable models in North America, including Chevrolet Silverado and GMC Sierra pickups, as well as Chevrolet Tahoe, Chevrolet Suburban, GMC Yukon and Escalade SUV, which account for more than half of GM's revenue in North America.

Because GM earns about $65 billion a year from pickup sales. According to the data, even in the overall downward state of the US car market in 2019, the pickup market is still one of the best in the US auto market. The total sales of the US pickup market for the whole year reached 3113943, an increase of 5.4% over the same period last year and a new high in nearly three years. Market share is nearly 18.2%. Among them, the Chevrolet pickup model Silverado ranked third in sales for the year, with a cumulative total of 576000 vehicles, down 1.7 per cent from a year earlier. The first two are also pick-up trucks, namely Ford and RAM.

Not only pickup models, but also large and medium-sized SUV markets in North America. Therefore, large-engine SUV models and pickup models play a leading role in the North American market, and the suspension of production means that it will also bring heavy damage to the American market economy. Because the US market, known as the "country on car wheels", has an annual output value of US $700 billion in the automobile industry, almost more than 30% of the GDP of the US manufacturing industry, while Ford and General Motors, as the giants of the US automobile industry, basically occupy the vast majority of the automobile industry.

Currently, GM has closed 15 assembly plants in China under the influence of novel coronavirus's epidemic. However, the company plans to resume production at these plants from Saturday to ensure a recovery in the supply chain. Next week, GM also plans to suspend production at a plant in South Korea for two days to ensure the supply of parts.

General Motors is not the only overseas car company affected by the domestic epidemic. As early as last week, Hyundai Motor in South Korea and Nissan in Japan said that there was a shortage of parts and components caused by the epidemic. The company had to stop production plans on some of its production lines in the country.

However, South Korea's Hyundai Motor said a few days ago that in early February, the production plan was affected because the supply of some parts such as assembly circuits could not support production. At present, due to the resumption of work by some parts companies, the active search for alternative sources of supply, and the full assistance of the Chinese and South Korean governments, the supply problem has been greatly improved, so it is decided to fully resume the production of the vast majority of production lines from the 17th.

China, as the world's largest automobile market and the world's largest trading country, will be seriously affected not only by the domestic market, but also by the global automobile market. According to an assessment by the International Trade Center, the epidemic will reduce China's manufacturing output by about $10 billion, while output in other parts of the world will also be reduced by $6.7 billion, with the greatest impact on the United States, Japan and South Korea.

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