Hyundai, the world’s fifth-largest carmaker, said on Tuesday that it was suspending production lines at its car factories in South Korea, one of the first major manufacturers to face severe supply chain issues because of the coronavirus.
Hyundai, which relies on auto parts from China, said in a statement that it had “decided to suspend its production lines from operating at its plants in Korea. The decision is due to disruptions in the supply of parts resulting from the coronavirus outbreak in China.”
Many auto plants in China have shut down because of the virus, including factories run by Hyundai, Tesla, Ford and Nissan. Hyundai plants in South Korea would be the first to shut down lines outside China, and the move comes as Hyundai had ramped up production in China over the past two decades.
“The company is reviewing various measures to minimize the disruption of its operations, including seeking alternative suppliers in other regions,” a Hyundai spokesman said in an email. The company said suspension schedules would vary by line.
Hyundai and its affiliated automaker, Kia, produced 7.2 million cars last year. Hyundai has a worldwide network of factories, including plants in Russia, Turkey, the Czech Republic and Montgomery, Ala., which can probably make up for lost production in Korea.
But the shutdown of some production at its Korean plants may signal further disruptions at manufacturers that depend on parts from China. The longer that Chinese factories remain shut down, the greater the risk of shortages of key components.
Hyundai sold more than four million vehicles last year, most of them in China and the United States.
