Czech automobile sector the next potential victim of coronavirus

by   CIJ iDesk I
2020-02-20   10:55
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Cruise ships stuck in Asian ports are dominating the coronavirus crisis news, but Czech companies are already coming down with one of the complications of the disease: a lack of parts. Countless numbers of Chinese manufacturing companies have stopped sending their supplies of parts that are critical for European electronic and automobile producers. The daily Hospodářské noviny, which spoke with nearly 30 Czech companies whose business is tied directly to China, writes that many have had to reduce output at their factories. They say the situation could become critical in March. "There are still a lot of components on the way, said Jiří Grund, chairman of the Association of Exporters. "But if the situation in China doesn't improve quickly, within one or two months the supply of parts will be exhausted and that could be a big problem for companies."

HN cites a Morgan Stanley analysis which found that Chinese industrial production was operating last week at between 30 and 50 percent. This could improve to 60 to 80 percent, but only if the spread of the epidemic slows down dramatically. It's believed that 75,000 people have been infected by the disease so far resulting in an estimated 2,000 fatalities.