Business Hilights
Tracking Nigeria's Headline Business News Online

Coronavirus disrupting global auto supply chain—Report

…Prices of auto spare parts, others to jump soon—ASPMDA

Aside physical health impacts, new report Monday, 10 February 2020, revealed that Coronavirus driven-lockdown of key manufacturing cities in China especially Wuhan, has hit global auto supply chain.

This is base on the fact that Wuhan, the epicentre of Coronavirus remains the key manufacturing hub including vehicles, cosmetics, auto parts and general goods.

Already, global auto giants, including Kia, Nissan, Hyundai and others have shutdown their production lines across mainland China which will translate to global auto scarcity across Europe, Africa, Americas and parts of Asia.

On how the auto manufacturing shutdown will affect Nigeria and the rest of Africa, former President of Auto Spare Parts and Machinery Dealers’ Association (ASPMDA), in Lagos Trade Fair Complex, Chief Tony Ughagwu, said “We have already started feeling the impacts. Our importing members here in ASPMDA have stopped placing orders since Coronavirus started in China.

“And you know, every auto parts importer places orders for his products to China every week because it takes about one full month to place order and receive your consignments and like I said earlier, since mid of January to date, many have not placed orders due to the virus.

“Now, if ASPMDA traders fail to place orders for one full month, it means that in not more than two to three months ahead, there will definitely be scarcity of the particular products.

“With the observed or forced drop in orders, between May and July, there will be scarcity of many auto products which means that their prices will go up within the period.

“However, producers in China have confided in us here at ASPMDA that they may resume manufacturing very soon as infection rate drops. And they also informed us that we should be ready to pay more for Chinese products because many companies will be spending more on restarting their production chain.

In his final submission on the impacts of coronavirus, Chief Ughagwu made it clear that prices of auto spare parts will be going up sooner than later.

Business Hilights gathered that Chinese government is already working on not only reopening shut manufacturing cities as cases of new infections drop, but introducing a special factory reopening support package for all disrupted manufacturing concern in China industrial cities.

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