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Automakers to close European plants temporarily to stem outbreak

By Don Jacobson
Automakers to close European plants temporarily to stem outbreak
A Volkswagen employee works on the assembly line at a plant in Zwickau, Germany, on February 25.  Photo by Uwe Meinhold/EPA-EFE

March 17 (UPI) -- Major automakers this week are moving to shut down their European production lines amid the coronavirus outbreak, citing the need to protect their workers and deteriorating supply chains.

Carmakers including Volkswagen, Fiat Chrysler, Peugeot and Ford all have instituted temporary closures in Europe, where the industry was already mired in a sales slump

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German carmaker Volkswagen announced Tuesday it is preparing to temporarily shut down the majority of its European plants "in the near future" for at least two weeks.

CEO Herbert Diess said in the company's annual earnings webcast that plants in Spain, Slovakia and Italy would soon be shuttered and warned the effects of the outbreak is unknown.

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Italy has become the global epicenter of the outbreak, with nearly 28,000 cases and more than 2,100 deaths while Spain has overtaken South Korea as the nation with the fourth-most number of cases -- nearly 10,000 and more than 300 deaths, according to a live tally kept by Johns Hopkins University.

"The spread of coronavirus is currently impacting the global economy. It is uncertain how severely or for how long this will also affect the Volkswagen Group," Volkswagen CFO Frank Witter said in a statement. "Currently, it is almost impossible to make a reliable forecast."

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Fiat Chrysler and Peugeot's PSA Group also announced they would shut down most manufacturing capacity in Europe.

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Fiat Chrysler said it would temporarily close six Italian factories and plants in Serbia and Poland. The factories assemble Fiat, Jeep, Maserati and Alfa Romeo vehicles.

"The temporary suspension, which will be in effect through March 27, 2020, continues the implementation of a comprehensive set of actions in response to the COVID-19 emergency and enables the group to effectively respond to the interruption in market demand by ensuring the optimization of supply," the company said in a statement.

PSA Group said it will close 15 European plants through March 27, including facilities in France, Spain, Italy, Germany, Britain, Poland, Portugal and Slovakia.

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The company said it's instituting the closures "due to the acceleration observed in recent days of serious COVID-19 cases close to certain production sites, supply disruptions from major suppliers, as well as the sudden decline in the automobile markets."

U.S. automaker Ford said it will close a production line Valencia, Spain, after three new cases at the site.

"We are taking quick action to follow the established protocol, including the identification and self-isolation of all employees who had close contact with the affected workers," the company said.

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Scenes from a pandemic: World copes with COVID-19

A health worker with the Israeli national emergency service, Magen David Adam, wears protective gear while taking swabs to test for COVID-19 at a drive-through testing center in East Jerusalem on August 26. Photo by Debbie Hill/UPI | License Photo

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