Winter Weather Impact On China Auto Plants Small

Anthony Fontanelle
February 1, 2008

Automaker and analysts in China said last Wednesday that the disruption at the operations of production due to fierce winter weather should be short-lived and annual output is unlikely to be affected. Most of the firms can comfortably make up lost production with extra weekend shifts or by running at higher capacity for a while, they added.

The inflation in the territory mated to output loss as direct results of power interruptions and derailed transport further resulted in a stock market dive. Other consequences include the inflation of zinc and other metals.

"We're not yet certain of the volume impact, but it seems we'll be able to manage with the inventory that we have," said a Nissan Motor Co. spokeswoman in Tokyo.

Starting Monday, the maker of Nissan NX radiators suspended production in the central Chinese city of Wuhan and in the southern city of Guangzhou due to power brownouts and road closures attributed to the heavy snow.

General Motors Corp. said the bad weather had disrupted its logistics system, causing its two ventures with SAIC Motor, the largest automaker in China, to adjust or cancel some shifts this week. But the ventures have made plans to recoup the lost production soon, the Detroit automaker added without going into details.

French manufacturer PSA Peugeot Citroen, the partner of Dongfeng Motor, said that work at its Wuhan factory was disrupted last week, but it made up for lost production at the weekend.

Ford Motor Co.'s production in the eastern Chinese city of Nanjing has been closed since Monday, but it may resume part of its operations on Thursday, the company executive who refused to be named told Reuters in an interview.

Ford’s Nanjing facilities include a research and engineering center, an assembly plant and an engine factory which it jointly owns with Mazda Motor Corp. and Changan Automobile Group, a Chinese automaker.

Honda Motor Co. suspended operations last Tuesday at one of its two plants in Guangzhou where its famous Accord sedan is built. The suspension was attributed to bad traffic and delayed supply of parts. Production resumed on Wednesday, although Honda's joint venture factory with Dongfeng Motor in Wuhan cancelled work on Wednesday, a spokesman of the company said.

Meanwhile, northern China auto factories have been little affected. BMW Group, Daimler AG, Volkswagen AG, as well as local players such as Brilliance Automotive, Great Wall Motor and Sinotruk 3808.HK, said their operations had not been disrupted at all.

Source:  Amazines.com