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| Virus Exposes Cracks in Carmakers’ Chinese Supply Chains | Virus Exposes Cracks in Carmakers’ Chinese Supply Chains |
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| The coronavirus is providing a lesson in how much the world’s car factories revolve around China. | The coronavirus is providing a lesson in how much the world’s car factories revolve around China. |
| Hyundai, the world’s fifth-largest automaker, said Tuesday that it was temporarily stopping production lines at its factories in South Korea because of shortages of Chinese parts. | Hyundai, the world’s fifth-largest automaker, said Tuesday that it was temporarily stopping production lines at its factories in South Korea because of shortages of Chinese parts. |
| The Hyundai shutdowns — the first factory lines to be idled outside China — could portend much more serious disruptions in the complex networks that supply automakers with essential components and materials. | The Hyundai shutdowns — the first factory lines to be idled outside China — could portend much more serious disruptions in the complex networks that supply automakers with essential components and materials. |
| Hyundai “decided to suspend its production lines from operating at its plants in Korea,” the company said in a statement. “The decision is due to disruptions in the supply of parts resulting from the coronavirus outbreak in China.” | Hyundai “decided to suspend its production lines from operating at its plants in Korea,” the company said in a statement. “The decision is due to disruptions in the supply of parts resulting from the coronavirus outbreak in China.” |
| President Trump’s trade war notwithstanding, the global economy remains highly interconnected and interdependent. Supply chains are finely tuned to deliver parts just as they are needed, so companies don’t need to waste money on big warehouses. | President Trump’s trade war notwithstanding, the global economy remains highly interconnected and interdependent. Supply chains are finely tuned to deliver parts just as they are needed, so companies don’t need to waste money on big warehouses. |
| The systems are efficient, but also vulnerable. The coronavirus is testing these supply chains in ways they have never been tested before. | The systems are efficient, but also vulnerable. The coronavirus is testing these supply chains in ways they have never been tested before. |
| Automakers are especially susceptible to interruptions in the flow of goods because the industry is global, and cars are complex products with many precision parts. The scope of the damage is impossible to measure, because no one knows how long the coronavirus emergency will last and how bad it will get. | Automakers are especially susceptible to interruptions in the flow of goods because the industry is global, and cars are complex products with many precision parts. The scope of the damage is impossible to measure, because no one knows how long the coronavirus emergency will last and how bad it will get. |
| So far, factory closings have not affected the production of autos and parts in North America, where almost all vehicles include at least some Chinese components. | So far, factory closings have not affected the production of autos and parts in North America, where almost all vehicles include at least some Chinese components. |
| Many manufacturers have inventories of parts to use or expect new shipments that left China before the outbreak, said Dan Hearsch, a managing director in the automotive and industrial practice at AlixPartners. | Many manufacturers have inventories of parts to use or expect new shipments that left China before the outbreak, said Dan Hearsch, a managing director in the automotive and industrial practice at AlixPartners. |
| “Everybody planned to be down for a week, but nobody planned to be down for a month,” he said. “The manufacturers are concerned about depleting their inventory of parts, but the question is how long is it going to go on? If it becomes six weeks, eight weeks, 10 weeks, that’s a real problem.” | “Everybody planned to be down for a week, but nobody planned to be down for a month,” he said. “The manufacturers are concerned about depleting their inventory of parts, but the question is how long is it going to go on? If it becomes six weeks, eight weeks, 10 weeks, that’s a real problem.” |
| In China, many auto plants have already shut down because of the virus, including factories run by Hyundai, Tesla, Ford and Nissan. Companies like Volkswagen, Daimler and Continental, a German supplier of electronics and other components, said they planned to reopen their factories in China next week if they received government authorization. | In China, many auto plants have already shut down because of the virus, including factories run by Hyundai, Tesla, Ford and Nissan. Companies like Volkswagen, Daimler and Continental, a German supplier of electronics and other components, said they planned to reopen their factories in China next week if they received government authorization. |
| “The supply chain is on track to be fully functional in time for start of production, and planned deliveries to customers remain unchanged,” Volkswagen said in a statement. Ford, which has two joint ventures in China, plans to resume production there early next week, a spokesman said. | “The supply chain is on track to be fully functional in time for start of production, and planned deliveries to customers remain unchanged,” Volkswagen said in a statement. Ford, which has two joint ventures in China, plans to resume production there early next week, a spokesman said. |
| But in the meantime, companies are paying workers to stay home and maintaining idle factories. The closings could last beyond next week if the virus spreads further and the death toll rises. | But in the meantime, companies are paying workers to stay home and maintaining idle factories. The closings could last beyond next week if the virus spreads further and the death toll rises. |
| “It’s simply too early to comment on the impact,” Ford’s chief executive, Jim Hackett, told analysts on an earnings call on Tuesday. “It will take weeks to understand the implications of the outbreak.” | “It’s simply too early to comment on the impact,” Ford’s chief executive, Jim Hackett, told analysts on an earnings call on Tuesday. “It will take weeks to understand the implications of the outbreak.” |
| The extra costs and lost sales hit the auto industry at an especially bad time. Sales in the United States, Europe and China slumped last year because of trade tensions, and the industry is in the midst of a costly shift to electric cars with autonomous driving technology. | The extra costs and lost sales hit the auto industry at an especially bad time. Sales in the United States, Europe and China slumped last year because of trade tensions, and the industry is in the midst of a costly shift to electric cars with autonomous driving technology. |
| Daimler issued a profit warning last month, citing legal costs in the United States and other jurisdictions where the authorities are investigating possible emissions cheating. | Daimler issued a profit warning last month, citing legal costs in the United States and other jurisdictions where the authorities are investigating possible emissions cheating. |
| The virus has also demonstrated how much automakers have come to depend on China for sales and growth. China has become the biggest car market by far and until recently the most dynamic. But even before the virus hit, an economic slowdown in China had depressed sales. | The virus has also demonstrated how much automakers have come to depend on China for sales and growth. China has become the biggest car market by far and until recently the most dynamic. But even before the virus hit, an economic slowdown in China had depressed sales. |
| German carmakers are particularly sensitive to what happens in China. Volkswagen sells more cars there than anywhere else, and it is also a critical market for BMW and Daimler, the maker of Mercedes-Benz cars. | German carmakers are particularly sensitive to what happens in China. Volkswagen sells more cars there than anywhere else, and it is also a critical market for BMW and Daimler, the maker of Mercedes-Benz cars. |
| “The biggest problem in Wuhan is that nobody is buying a car,” said Ferdinand Dudenhöffer, a professor at the University of Duisburg-Essen who follows the auto industry. “The Germans have the biggest risk portfolio in China.” | “The biggest problem in Wuhan is that nobody is buying a car,” said Ferdinand Dudenhöffer, a professor at the University of Duisburg-Essen who follows the auto industry. “The Germans have the biggest risk portfolio in China.” |
| European automakers and suppliers surveyed Tuesday said they were not experiencing disruptions to factories outside China, but acknowledged that the situation could change. | European automakers and suppliers surveyed Tuesday said they were not experiencing disruptions to factories outside China, but acknowledged that the situation could change. |
| Updated June 2, 2020 | |
| Mass protests against police brutality that have brought thousands of people onto the streets in cities across America are raising the specter of new coronavirus outbreaks, prompting political leaders, physicians and public health experts to warn that the crowds could cause a surge in cases. While many political leaders affirmed the right of protesters to express themselves, they urged the demonstrators to wear face masks and maintain social distancing, both to protect themselves and to prevent further community spread of the virus. Some infectious disease experts were reassured by the fact that the protests were held outdoors, saying the open air settings could mitigate the risk of transmission. | Mass protests against police brutality that have brought thousands of people onto the streets in cities across America are raising the specter of new coronavirus outbreaks, prompting political leaders, physicians and public health experts to warn that the crowds could cause a surge in cases. While many political leaders affirmed the right of protesters to express themselves, they urged the demonstrators to wear face masks and maintain social distancing, both to protect themselves and to prevent further community spread of the virus. Some infectious disease experts were reassured by the fact that the protests were held outdoors, saying the open air settings could mitigate the risk of transmission. |
| Exercise researchers and physicians have some blunt advice for those of us aiming to return to regular exercise now: Start slowly and then rev up your workouts, also slowly. American adults tended to be about 12 percent less active after the stay-at-home mandates began in March than they were in January. But there are steps you can take to ease your way back into regular exercise safely. First, “start at no more than 50 percent of the exercise you were doing before Covid,” says Dr. Monica Rho, the chief of musculoskeletal medicine at the Shirley Ryan AbilityLab in Chicago. Thread in some preparatory squats, too, she advises. “When you haven’t been exercising, you lose muscle mass.” Expect some muscle twinges after these preliminary, post-lockdown sessions, especially a day or two later. But sudden or increasing pain during exercise is a clarion call to stop and return home. | Exercise researchers and physicians have some blunt advice for those of us aiming to return to regular exercise now: Start slowly and then rev up your workouts, also slowly. American adults tended to be about 12 percent less active after the stay-at-home mandates began in March than they were in January. But there are steps you can take to ease your way back into regular exercise safely. First, “start at no more than 50 percent of the exercise you were doing before Covid,” says Dr. Monica Rho, the chief of musculoskeletal medicine at the Shirley Ryan AbilityLab in Chicago. Thread in some preparatory squats, too, she advises. “When you haven’t been exercising, you lose muscle mass.” Expect some muscle twinges after these preliminary, post-lockdown sessions, especially a day or two later. But sudden or increasing pain during exercise is a clarion call to stop and return home. |
| States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people. | States are reopening bit by bit. This means that more public spaces are available for use and more and more businesses are being allowed to open again. The federal government is largely leaving the decision up to states, and some state leaders are leaving the decision up to local authorities. Even if you aren’t being told to stay at home, it’s still a good idea to limit trips outside and your interaction with other people. |
| Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks. | Touching contaminated objects and then infecting ourselves with the germs is not typically how the virus spreads. But it can happen. A number of studies of flu, rhinovirus, coronavirus and other microbes have shown that respiratory illnesses, including the new coronavirus, can spread by touching contaminated surfaces, particularly in places like day care centers, offices and hospitals. But a long chain of events has to happen for the disease to spread that way. The best way to protect yourself from coronavirus — whether it’s surface transmission or close human contact — is still social distancing, washing your hands, not touching your face and wearing masks. |
| Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days. | Common symptoms include fever, a dry cough, fatigue and difficulty breathing or shortness of breath. Some of these symptoms overlap with those of the flu, making detection difficult, but runny noses and stuffy sinuses are less common. The C.D.C. has also added chills, muscle pain, sore throat, headache and a new loss of the sense of taste or smell as symptoms to look out for. Most people fall ill five to seven days after exposure, but symptoms may appear in as few as two days or as many as 14 days. |
| If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.) | If air travel is unavoidable, there are some steps you can take to protect yourself. Most important: Wash your hands often, and stop touching your face. If possible, choose a window seat. A study from Emory University found that during flu season, the safest place to sit on a plane is by a window, as people sitting in window seats had less contact with potentially sick people. Disinfect hard surfaces. When you get to your seat and your hands are clean, use disinfecting wipes to clean the hard surfaces at your seat like the head and arm rest, the seatbelt buckle, the remote, screen, seat back pocket and the tray table. If the seat is hard and nonporous or leather or pleather, you can wipe that down, too. (Using wipes on upholstered seats could lead to a wet seat and spreading of germs rather than killing them.) |
| More than 40 million people — the equivalent of 1 in 4 U.S. workers — have filed for unemployment benefits since the pandemic took hold. One in five who were working in February reported losing a job or being furloughed in March or the beginning of April, data from a Federal Reserve survey released on May 14 showed, and that pain was highly concentrated among low earners. Fully 39 percent of former workers living in a household earning $40,000 or less lost work, compared with 13 percent in those making more than $100,000, a Fed official said. | |
| Taking one’s temperature to look for signs of fever is not as easy as it sounds, as “normal” temperature numbers can vary, but generally, keep an eye out for a temperature of 100.5 degrees Fahrenheit or higher. If you don’t have a thermometer (they can be pricey these days), there are other ways to figure out if you have a fever, or are at risk of Covid-19 complications. | Taking one’s temperature to look for signs of fever is not as easy as it sounds, as “normal” temperature numbers can vary, but generally, keep an eye out for a temperature of 100.5 degrees Fahrenheit or higher. If you don’t have a thermometer (they can be pricey these days), there are other ways to figure out if you have a fever, or are at risk of Covid-19 complications. |
| The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don’t need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don’t replace hand washing and social distancing. | The C.D.C. has recommended that all Americans wear cloth masks if they go out in public. This is a shift in federal guidance reflecting new concerns that the coronavirus is being spread by infected people who have no symptoms. Until now, the C.D.C., like the W.H.O., has advised that ordinary people don’t need to wear masks unless they are sick and coughing. Part of the reason was to preserve medical-grade masks for health care workers who desperately need them at a time when they are in continuously short supply. Masks don’t replace hand washing and social distancing. |
| If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others. | If you’ve been exposed to the coronavirus or think you have, and have a fever or symptoms like a cough or difficulty breathing, call a doctor. They should give you advice on whether you should be tested, how to get tested, and how to seek medical treatment without potentially infecting or exposing others. |
| If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested. | If you’re sick and you think you’ve been exposed to the new coronavirus, the C.D.C. recommends that you call your healthcare provider and explain your symptoms and fears. They will decide if you need to be tested. Keep in mind that there’s a chance — because of a lack of testing kits or because you’re asymptomatic, for instance — you won’t be able to get tested. |
| “We are watching closely, but at the moment there are no effects,” said Saskia Essbauer, a spokeswoman for BMW. “Currently supplies are assured.” | “We are watching closely, but at the moment there are no effects,” said Saskia Essbauer, a spokeswoman for BMW. “Currently supplies are assured.” |
| A spokeswoman for the French carmaker Renault, Rié Yamane, said in an email: “At this stage we have no impact but the supply chain teams are closely studying the subject.” | A spokeswoman for the French carmaker Renault, Rié Yamane, said in an email: “At this stage we have no impact but the supply chain teams are closely studying the subject.” |
| And Hyundai “is reviewing various measures to minimize the disruption of its operations, including seeking alternative suppliers in other regions,” a spokesman said via email. The company said suspension schedules would vary by assembly line. | And Hyundai “is reviewing various measures to minimize the disruption of its operations, including seeking alternative suppliers in other regions,” a spokesman said via email. The company said suspension schedules would vary by assembly line. |
| Hyundai and its affiliated automaker, Kia, produced 7.2 million cars last year. Hyundai has a worldwide network of factories, including plants in Russia, Turkey, the Czech Republic and Montgomery, Ala., which can probably make up for lost production in South Korea. | Hyundai and its affiliated automaker, Kia, produced 7.2 million cars last year. Hyundai has a worldwide network of factories, including plants in Russia, Turkey, the Czech Republic and Montgomery, Ala., which can probably make up for lost production in South Korea. |
| But the longer that Chinese factories remain shut, the greater the risk that shortages will affect other manufacturers. | But the longer that Chinese factories remain shut, the greater the risk that shortages will affect other manufacturers. |
| Auto parts frequently imported from China include wheels, suspension systems including shock absorbers, and electronic components. | Auto parts frequently imported from China include wheels, suspension systems including shock absorbers, and electronic components. |
| A handful of vehicles are produced in China and exported to the United States. They include the Buick Envision from General Motors, a sport utility vehicle. The Ford ExoSport, which is made in India with about 15 percent of its parts coming from China, is also sold in the American market. | A handful of vehicles are produced in China and exported to the United States. They include the Buick Envision from General Motors, a sport utility vehicle. The Ford ExoSport, which is made in India with about 15 percent of its parts coming from China, is also sold in the American market. |