Categories: WheelsWorld

Shanghai lockdowns could force China carmakers to stop production, XP


Beijing, China – Chinese auto makers may have to put the brakes on production if strict Covid-19 curbs in Shanghai persist, said the founder of electric carmaker XPeng, as a prolonged lockdown of the economic hub menaces supply chains.

The lockdown has kept Shanghai’s 25 million residents mostly at home, forcing manufacturers to halt operations, and has made China’s GDP growth target of around 5.5 percent look increasingly difficult to achieve.

Covid outbreaks across the country and the associated reductions in economic activity have already hit the auto industry hard, with car sales dropping 10.5 percent in March.

“If supply chain companies in Shanghai and its surrounding areas cannot find a way to dynamically resume work and production, all original equipment manufacturers may have to stop production in May,” XPeng chief He Xiaopeng said Thursday on social media.

XPeng has been touted as a Chinese challenger to US electric car giant Tesla, and its chief said that businesses were hoping for more support from the authorities to navigate the Covid closures.

Volkswagen also said it has been “severely hit by Covid-19 outbreaks in Changchun and Shanghai”, where the German titan’s Chinese joint ventures are located.

The firm is “temporarily unable to meet high customer demand”, said Volkswagen Group China CEO Stephan Wollenstein on Thursday, adding that he hoped the production delays could be made up in the coming months.

China’s zero-Covid policy has been increasingly strained as the country battles its highest number of infections since the start of the pandemic.

Volkswagen said around 20 percent of its dealers were forced to temporarily close in March alone as a result of lockdowns.

Tesla’s multi-billion-dollar “gigafactory” in Shanghai — which the company calls its main export hub — has also been reportedly shut.

Chinese electric vehicle maker Nio said last weekend that it had suspended vehicle production, as business partners in virus-hit areas such as Jilin and Shanghai halted operations.


Dayang Norazhar

Recent Posts

Hong Leong Bank 4Q profit up 4.4%, overcomes net interest income dip

HONG Leong Bank Bhd (HLB) reported a 4.4% increase in net profit for the second…

2 mins ago

New Brand Partner Brings Premium Vertical File Cabinets to Madison Liquidators

MADISON, Wis., Feb. 28, 2024 /PRNewswire/ -- Madison Liquidators, in a new partnership with Gen2,…

31 mins ago

Another 6,000 medical officers to be appointed to permanent posts in 2024-2025

KUALA LUMPUR — The government will be appointing another 6,000 medical officers to permanent positions…

37 mins ago

Squarespace Announces Fourth Quarter and Full Year 2023 Financial Results and $500 Million Share Repurchase Authorization

Revenue Increased 18% in the Fourth Quarter and 17% for the Full Year 2023, Topping…

38 mins ago

Flash News: OKG Technology Chairman Jeff Ren Outlines the Future of Web3 at Economist Impact’s Technology for Change Asia 2024

HONG KONG, Feb. 28, 2024 /PRNewswire/ -- OKG Technology Holdings Limited (OKG Tech, 1499.HK), a…

39 mins ago