Japan's automotive sector is also afflicted by the raging COVID-19. (Image via Global Risk Insights)

Japan's automotive industry blown by COVID-19

Alfonsus Adi Putra
Business & Industry
Automotive & Equipment
Mar 08, 2020
1943
As the novel coronavirus (COVID-19) broke out in China and spreading to more than 50 countries globally, it disrupts the global productivity and supply chains. Japan, known for its automotive industry, also is facing disruption of parts procurement from China, the ground zero of the COVID-19 outbreak.

New vehicle sales in Japan fell 10.3 percent in February, compared to the same period last year. The sales fell to 430,185 units, a double-digit monthly fall for the fifth consecutive year.

The matter forced Japan to alter production plans in the coming months. Moreover, the Japanese automakers have not determined the impact of COVID-19 on their earnings outlook. They need to watch fluid development. It caused the shareholders a lot of headaches.

Not only production but also as the customers are told to stay indoors during the outbreak, Japanese automakers are banging their heads to the wall, facing the triple whammy. Japan is struggling to recover from the consumption tax hike impacts in October 2019.

Moreover, Japan had just been hit with floods and typhoons in the Fall season last year.

But, compared with natural disasters, it is harder for the industry to determine the effect as they have no idea when the epidemic will end; hence, disarraying the production and sales plans. For instance, Japanese automakers had reserved a contingency plan for the 2011 Fukushima disaster.

However, for COVID-19, it is a different matter with a different nature.

Source: https://bit.ly/2VTAQHZ

Business , Company , Automotive , Vehicles , Car , Motorcycle , Truck , Bus , Medical , Health , Disease , Pulmonary , Pneumonia , Coronavirus , COVID-19 , Asia , Japan