State of China Auto Manufacturing
Current General Manager, Procurement and Supply Chain, SAIC General Motors Corporation
inpractise.com/articles/covid-manufacturing-auto
Why is this interview interesting?
- The state of auto manufacturing in China in Q1
Liang Zhou
Current General Manager, Procurement and Supply Chain, SAIC General Motors Corporation
Interview Transcript
Moving on to looking at the manufacturing and the factories. Are factories opening again, in mainland China, the automotive big OEMs?
All of them, they are already back to normal. They came back to normal at different times. For example, Volkswagen, they reopened in the middle of February. Most of the OEMs are already back to normal.
What is the situation inside the factories, in terms of the workers and the processes? Has it materially changed?
They are sometimes short of material because some components, some parts they come from the epidemic center, from Wuhan. As you know, Wuhan is still locked down by the government, so they are not able to produce these kind of components and parts. So for each OEM in China, they are already back to normal production, but the production volume is much lower, compared to last year. They are maybe at around 50% compared to the same months last year.
So huge decline in capacity utilization?
Yes. In February, the sales volume and the production volume is 80% reduction. For March and April, it would normally go back to normal, but it’s only going to be around the 50% level compared to last year.
Do you estimate that in April and May, you will return to capacity utilization and volume demand, on trend with 2019? Or do you think it will take much longer?
I think the epidemic in China, it will end around April, which means that for March and April, the sales volume will be half of last year. But after April, maybe May or June, then it will gradually become, maybe 70% or 80%, which means it will gradually come back to normal, I think.
Copyright Notice
This document may not be reproduced, distributed, or transmitted in any form or by any means including resale of any part, unauthorised distribution to a third party or other electronic methods, without the prior written permission of IP 1 Ltd.
IP 1 Ltd, trading as In Practise (herein referred to as "IP") is a company registered in England and Wales and is not a registered investment advisor or broker-dealer, and is not licensed nor qualified to provide investment advice.
In Practise reserves all copyright, intellectual and other property rights in the Content. The information published in this transcript (“Content”) is for information purposes only and should not be used as the sole basis for making any investment decision. Information provided by IP is to be used as an educational tool and nothing in this Content shall be construed as an offer, recommendation or solicitation regarding any financial product, service or management of investments or securities.
© 2024 IP 1 Ltd. All rights reserved.