Covid-19 brings car production in Europe to a halt: Page 2 of 2

March 19, 2020 //By Christoph Hammerschmidt
Covid-19 brings car production in Europe to a halt
The coronavirus has sent large parts of the European automobile production into a coma. It is unclear how this will affect the electronics supply chain.

If you ask in detail, you usually get trivial answers. In many cases, the companies are afraid of giving away something that could have an impact on the stock price. Continental, for example, left an inquiry from eeNews Europe unanswered. According to press reports, however, the company regards the temporary closure of factories as "last resort, implemented only in extreme cases".

As an unlisted company, Bosch can afford to be more open. In response to a request from eeNews Europe, the company informed that it was currently investigating the situation together with its customers. "At this point in time, we are largely able to maintain production and our supply chains and meet the needs of our customers. This also applies to our semiconductor production," explained a Bosch spokesman. However, he added that the situation was "dynamic" and could change rapidly.

The lighting and radar specialist Hella reduced its profit targets in a press release as a result of the pandemic. The company also announced that short-time working was being prepared at certain locations.

Semiconductor manufacturers, as tier 2 suppliers to the automotive industry, have also been affected by the production closures. However, they are extremely cautious about the effects of the downstream production stops. NXP, one of the largest chip suppliers to the automotive industry, had already lowered its sales targets by 5% at the beginning of the month because of the corona virus. "We cannot comment at this time beyond our press release issued earlier this month," a company spokesperson said. STMicroelectronics announced earlier that it keeps on working in Italy despite the massive lockdown in that country.

Renesas, another big player in the automotive electronics arena, makes the following preventive restrictions: “IF eeNews source of information about production stops is NOT based on the companies’ official statements or press releases, our statement will simply be “we would like to refrain from making comments on speculations in the reports”. Well, that the reports about production stops are no speculation should become immediately clear when looking at the media. Thus, Renesas is making a statement on the matter: „As coronavirus situation is changing on a daily basis, we are communicating and confirming the situation at each of our customer. We will continue to closely monitor market trends in our business areas and the operation status of our customers.“ Rensas set up a task force already at the beginning of February to deal with the effects of the virus on production and organize appropriate measures. The priority is to prevent the virus from spreading within the company and to protect employees, business partners and customers. In addition, the situation will be monitored and appropriate measures taken flexibly, the company said.

Infineon, whose delieveries to the automotive industry are also critical for its business, also holds back with comments. "As a matter of principle, we are not commenting on the current order situation," a spokesperson said. "We are observing the development very closely, a final evaluation is currently still difficult to estimate”. Whether such a statement creates trust is left to the reader.

But there is also good news - from China of all places, where the pandemic originated, the situation seems to be gradually changing for the better. There, Beijing Hyundai, Hyundai's Chinese joint venture with BAIC Motor, has resumed operations at its three production sites after the corona virus outbreak.


Related articles:

ST keeps working despite Italian 'lockdown'

NXP, Analog forecast about 5% coronavirus impact on quarterly revenues


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