Global car producers Volkswagen and Toyota’s factories in Tianjin have been shut down since Monday as the city battles a new epidemic outbreak.
While the factories remain closed until further notice, the production lines in other parts of China will try to make up for the potential capacity losses, industry insiders said, adding that the impact from the suspension should be manageable so long as the latest outbreak is soon reined in.
Due to the recent Covid-19 outbreaks, both the FAW-VW vehicle plant and component factory VW Automatic Transmission in Tianjin were shut down on Monday, Volkswagen Group China told the Global Times on Thursday.
Both plants have conducted Covid-19 testing for all their employees this week, the German auto company said.
“We hope to resume production very soon and catch up with lost production. The top priority remains the health and well-being of our employees,” said a source with Volkswagen Group China.
Meanwhile, FAW Toyota also said that its factory in Tianjin has suspended production and all employees have taken nucleic acid tests, according to media reports.
Tianjin reported 41 domestically transmitted infections with confirmed symptoms on Wednesday, up from 33 on Tuesday. Tianjin reported a total of 256 confirmed cases as of Wednesday.
While the government administers strict screening for epidemic control purposes, a total of 23,423 close contacts have been traced and 5,077 are still under medical observation as of Wednesday.
China is Volkswagen Group’s most important market, accounting for 40 percent of its global sales.
The production suspension will bring an impact for the company’s auto sales and put additional pressure on the already stretched production line in Europe where the pandemic has had a big impact, Cui Dongshu, secretary general of the China Passenger Car Association (CPCA), told the Global Times on Thursday.
Despite the blow from the suspension of production in Tianjin, experts believe that it will be manageable given the broad and balanced distribution of production capacity of the two global car makers across China.
Cui said that Volkswagen’s two plants in Tianjin only account for around 20 percent of the total production capacity in China, while the Toyota factory accounts for about half.
It should not be difficult for them to catch up after resumption if the epidemic in the region can be reined in ahead of the Chinese New Year, the expert said.
Residents take nucleic acid tests in Tianjin on January 9, 2022. Photo: VCG
