Hyundai ceased production in South Korea as the coronavirus spreads further and is the first major company to do so outside of China. The outrageous coronavirus outbreak has killed more than 400 people in China, which has led to many of the industries and businesses to temporarily shut down to curb the spread of the virus. Many of the major firms such as Tesla, Ford, Honda, Nissan, and Peugeot Citroen have already closed their factories in China.
Lee Hang-Koo, the Senior Researcher at Korea Institute for Industrial Economics and Trade said that, Hyundai and Kia will have to face major setback as compared to any other automobile companies as their import more from China. In the past two years, Hyundai established relatively bigger production capacity in China.
A Union Officer said that considering the sensitivity of the matter, South Korean factories will be suspended from 7 February 2020 and some of the factories will be resumed on 11 February 2020 or 12 February 2020.
The suspension of Hyundai’s South Korean factories will hamper the global output as it accounts around 40% of the production market. In South Korea, Hyundai currently has seven factories, which mainly supply to South Korean as well as few global markets such as the Middle East, the United States, and Europe.
The other companies including Mitsui & Co have stated that the virus outbreak may affect the global automotive sectors by slowing down the production activities.