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Carmakers cut European production amid Covid-19 shutdown

By Lawrence Gash

Workers are demanding better hygiene standards

Carmakers cut European production amid Covid shutdown

Car manufacturers across Europe are scaling back production as Covid-19 continues to spread throughout the continent. The likes of Fiat Chrysler, Volkswagen, and Peugeot have all reduced output.

Some firms have had to deal not only with slumping demand and the closure of borders across Europe, but also increasing worker unrest.

Due to the close proximity involved in production line manufacturing, worker representatives in Germany, France, Italy and Belgium have all demanded increased hygiene standards. Audi has admitted that some workers at its plant in Brussels have stopped turning up due to infection concerns.

PSA Group announced that its European factories will be closed from March 17 at the latest, until March 27 at the earliest. Opel, its subsidiary, has already asked hundreds of administrative staff at its Ruesselsheim headquarters to work from home after an employee tested positive for the coronavirus.

The spread of Covid-19 in Europe itself, has only compounded the existing damage wreaked by the virus on the European auto-sector.

The widespread quarantines across China in the past two months severely reduced demand, with the country’s leading industry body reporting an 80 per cent fall in passenger car sales in February when compared with the year before.

Beyond the plummeting demand from the world’s largest car market, European manufacturers have struggled with the disruption in the global supply chain triggered by the Chinese lockdowns.

China exported more than $60bn (£49bn, €54bn) worth of car parts in 2019, even during the trade war with the United States.

With shipments from China to Europe generally taking around six weeks, the European auto-sector could only just be beginning to feel the full impact.

FURTHER READING: China’s economic collapse worse than expected

FURTHER READING: European markets plunge despite central bank plans

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