The coronavirus, which has now taken more lives than the SARS outbreak in the early aughts, is expected to hurt Detroit automakers' sales in China, the Freep and News are reporting.
GM says that, as a result of the virus, it will extend through Saturday a production shut down that initially coincided with Lunar New Year. Ford, meanwhile, has begun to slowly resume production at its China factories in a process expected to take several days, according to the Detroit News. Fiat Chrysler — which has limited China production — reportedly planned to reopen plants in the coming days.
The News reports the virus is exacerbate existing trends.
As a result of the outbreak, the world's largest auto market will lose production of 1.2 million vehicles for the first quarter and see a 50%-80% decrease in sales in February, analysts forecast. The coronavirus scare is an added complication as automakers there face declining demand, trade tensions and stricter emissions regulations.
It is too early to tell by how much the virus will affect business, the automakers said. Even before the first person was diagnosed, GM's sales had declined there 15% in 2019, while profits were cut nearly in half to $1.1 billion. Ford's sales fell 26% in China, though it cut its losses there in half amid a turnaround plan and the introduction of new models. Fiat Chrysler, which has less than 1% of the Chinese market, saw sales drop 41% to 73,000 vehicles, according to Hong Kong-based consulting firm ZoZo Go LLC.
The U.S. has convened a task force to consider responses to the virus. But Donald Trump told a meeting of the nation's governors Monday that it could disappear by April. He later repeated the claim at a New Hampshire rally.
"With the heat, as the heat comes in, typically that will go away in April,” Trump reportedly told the govenors.
Experts say the virus could become seasonal, but it is not expected to go away.