The recent outbreak of the Coronavirus already is having a negative impact on China’s automotive industry and has the potential to disrupt the North American auto industry as well, according to a new alert published by LMC Automotive, an independent automotive global forecasting and market intelligence company in Troy.
In the alert, LMC’s base case scenario expects the epidemic to continue into the second quarter of 2020, damaging consumer confidence, delaying purchasing, and impacting China’s consumer economy, which accounts for more than half of the country’s GDP.
Under this scenario, China’s GDP growth rate would drop toward 5 percent for 2020.
“Overall, we expect the Coronavirus outbreak to hit Chinese sales and production by 3 percent to 5 percent this year, though this is just one of a number of potential scenarios that we have laid out in the alert, and further revisions are certain as more information becomes available in the coming days and weeks,” says Jeff Schuster, president of Americas operations and global vehicle forecasts at LMC Automotive. “This is a very fluid situation and one that warrants heightened attention as it has the potential to significantly reduce Chinese automotive production in 2020.”
An outbreak of the novel Coronavirus was first detected in China in December 2019 and has since spread to many regions of the world, having recently been declared an International Health Emergency by the World Health Organization.
As some areas of China are still in near-complete lockdown, automakers near the city of Wuhan and the surrounding Hubei Province have extended their Chinese New Year’s shutdowns.
Additionally, the local automotive supply chain has been affected, with a number of suppliers delaying their post-holiday production as well.
To stay abreast of this constantly changing situation or obtain a copy of the alert, visit lmc‐auto.com.