The impact of the COVID-19 pandemic on the global automotive industry chain is difficult to lift in the short term.
On the 19th, informed sources revealed to the first financial reporter that South Korea's Hyundai Motor Group mentioned in an internal meeting held today that south Korea's Hyundai Ulsan first factory faced partial suspension again after only one day of resuming work, and the Ulsan second plant will also be suspended for a day on the 21st, in addition, the Asan plant may also face another shutdown, due to insufficient supply of parts in China and the suspension of production or will continue.
Kia Motors, a subsidiary of South Korea's Hyundai Motor Group, has also decided to extend the shutdown of the Gwangcheong plant in Gyeonggi Province and the third plant in Gwangju to the 21st of this month.
Previously, Hyundai Motor had announced that it would fully resume the production of most of the local production lines in South Korea from the 17th, and only two days later, Hyundai Motor's Local Factory in South Korea was once again facing a shutdown. A person in charge of Hyundai Motor, who asked for anonymity, also told the first financial reporter that although the auto wiring harness parts produced in China are being supplied to the factory one after another, due to the insufficient supply of automotive wiring harness parts, the company decided to flexibly arrange the start time of each factory.
A person in charge of the Korea Association of Automobile Manufacturers (KAMA) confirmed to the first financial reporter that the first production line of the Ulsan Fifth Factory, which is currently responsible for the production of Hyundai's high-end brand GENESIS GV70 and GV80, cannot be restored, and the Ulsan Second Plant of the two models of GENESIS GV80 and the seven-seat flagship palisade is also in a "idling" state due to the shortage of parts, and some production lines even have a daily idling capacity of 440 vehicles. It is difficult to maintain normal operations, resulting in the impact on The global supply of Denissis, which is all produced and exported from Korea, and to some extent, Geneses' plans to enter emerging markets such as China and Europe.
In addition to Hyundai and Kia Motors, the Local Factories of SsangYong, Renault Samsung and South Korea's GM have also announced production cuts and shutdown measures, and South Korea's GM has also stopped production, and at present, South Korean automakers have successively stopped production, the most important reason is the shortage of supply of automotive wiring harnesses (assembly circuit boards) that make up the overall circuit system of the car. According to the statistics of the Korea Association of Automobile Manufacturers, 87% of the demand for the parts of the Korean automakers comes from China, and there are currently 40 first- and second-tier suppliers that supply related parts to the Korean automakers, of which 38 have resumed work, but the resumption rate is still less than 60%, so the association expects that if the supply continues to be short, only hyundai and Kia will face a reduction in the supply of nearly 50,000 vehicles. The resulting loss in sales will exceed 1 trillion won (about 5.88 billion yuan).
Kim Se-han, director of the marketing department of Yura, a Korean parts company that provides such parts for Hyundai Motor, also told the first financial reporter that although the company has entered the state of resumption of work, some employees returning from other places are still in home isolation, the production efficiency is about 50% of the same period, and the number of flights between China and South Korea has decreased, resulting in certain problems in transportation.
Liu Miao, a teacher at the School of Automotive and Mechanical Engineering of Shanghai University of Engineering Technology, told the first financial reporter that in the current situation of gradually complex automobile functions, automotive circuits also show the characteristics of gradual complexity, as a mature supply chain system of Korean enterprises, it is difficult to quickly replace suppliers in a short period of time. Park Young-kyu, president of the Korea Auto Parts Enterprises (China) Federation, said that most Korean vehicle companies have adopted the model of supply chain integration, and the distance between China and South Korea is relatively close, so many parts manufacturers that follow Korean automakers into China will also provide parts for South Korea's local production capacity, and the degree of integration of the automotive industry chain between China and South Korea is relatively high, so although the current impact is mainly concentrated in the car wiring harness that is difficult to prepare, it is not ruled out that the impact of the epidemic will expand to other parts.
Affected by the shortage of wiring harness supply, Hyundai is the first large-scale automobile manufacturer to close its factories outside Of China, while the production of overseas factories of international car companies such as GM, Nissan, Fiat Chrysler has also been affected, and Liu Miao believes that the suspension of production of overseas car companies, on the one hand, is the impact of the new crown pneumonia epidemic "everywhere", on the other hand, it also reflects the "ubiquity" of China's automobile industry in the global automotive industry chain, and reflects that China's automotive supply chain has an irreplaceable advantage in some aspects.
Moody's, an international credit rating agency, also believes that due to the flow of workers and the poor supply chain of auto parts, automobile production will also be limited in the short term due to shutdowns and declining production levels, and this impact will not only occur in China, but also affect other auto companies around the world that are more dependent on China.
The first financial reporter also learned that the factory of Beijing Hyundai, a joint venture of Hyundai Motor in China, has resumed work between the 3rd and 17th of this month.
Hyundai Motor provides financial support for small and medium-sized parts cooperation totaling about 6 billion yuan, in addition to the current shortage of epidemic prevention materials in China, to provide epidemic prevention materials to some small and medium-sized parts enterprises that urgently need to resume work to assist enterprises with complete epidemic prevention materials and conditions for resuming work to resume work, Beijing Hyundai also canceled the February dealer procurement completion rate assessment, and issued a series of dealer support measures such as providing expired bills of exchange bridge funds and remote technical support.