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Coronavirus impact on component supply from China, worries auto industry

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New Delhi, Feb 10: The Indian automotive industry is apprehensive about coronavirus outbreak disrupting component supplies from China, but a clear picture will emerge only in the next few days after factories in the country reopen, SIAM said on Monday.

Auto industry body Society of Indian Automobile Manufacturers (SIAM) said it will be collecting information and data from its members in the next couple of days to understand if there could be disruptions, and to what extent, if there are any.

Coronavirus impact on component supply from China, worries auto industry

"It is still slightly early to comment on it. The only thing I can say is that there are apprehensions and everybody is waiting to see as today is the day when China (market) is supposed to open up post their Chinese New Year holidays," SIAM Director General Rajesh Menon told reporters here.

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He was responding to query on whether the coronavirus outbreak would disrupt supplies from China and, if that happens, how it could affect transition to BS-VI emission norm from BS-IV from April 1.

"We will get clarity on the exact nature of impact and the possible implications. What is clear is that there are apprehensions. To what extent the problem will be, we will come to know in the next few days," Menon reiterated.

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    When asked if there would be a need for SIAM to make a representation to the Supreme Court to extend the BS-VI transition deadline in the wake of possible supply disruption due to coronavirus, Menon said, "It is too early (to comment on that). We have to wait from our member companies to decide on that. In two or three days we will have a better idea."

    He said the supply chain in the auto industry ranges from Tier I to Tier II and III suppliers, and information has to come from across.

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    "We are in touch with member companies and we will see what needs to be done once we have more data in hand," Menon said.

    He further said it was too early to assess how much of components come from China would see disruption.

    When asked about the problem posed by coronavirus, Maruti Suzuki Managing Director and CEO Kenichi Ayukawa told PTI, "Nobody knows at this moment."

    He further said it was unclear at the moment as to how long the outbreak would last and what sort of impact it could have.

    "Some people say it is very serious and some people say maybe three months later it will be fine," Ayukawa said, adding that the situation needed to be assessed.

    Last week, Tata Motors CEO and Managing Director Guenter Butschek had said that clarity about supply constraints of components from China will only emerge when workers in the coronavirus-hit country rejoin work (expected from Monday).

    The company, which imports certain components for both Nexon EV and other traditional models from China, said if the workers don't join work next week, then it could lead to supply issues for not only for Tata Motors but for the entire global automobile industry.

    The coronavirus outbreak and subsequent advisories on Chinese travelling into India has had an impact on the attendance of officials from participating companies at the Auto Expo here.

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    China's largest SUV manufacturer Great Wall Motor (GWM), which announced USD 1 billion in India, stated that its leadership team from the headquarter could not make it here due to the outbreak and the subsequent travel advisories.

    China's FAW Group firm automaker Haima Automobile also cancelled its scheduled press conference as top leadership team of the company could not make it to India.

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