PARIS -- Renault and PSA Group have extended the suspension of their industrial activities in China into March because of the effects of the coronavirus outbreak.
The two automakers have production hubs in the city of Wuhan and Hubei province, where the outbreak is centered.
Wuhan, with a population of 11 million, has been virtually shut down by the Chinese authorities in an effort to contain the spread of the virus, and other automakers, including Nissan and Honda, have announced that their factories in the area would remain shuttered.
A PSA Group spokeswoman said it was up to the authorities in China to decide when production would resume. At the moment, the factory in Wuhan, which PSA operates with Dongfeng Motor, is scheduled to reopen on March 12. The group evacuated its French workers in January.
Renault's factory in Wuhan, which it operates with Dongfeng in a joint venture, will be closed until March 10, a spokeswoman said.
"Renault is closely monitoring the situation and is strictly applying all measures decided by the local authorities and the WHO," she said, referring to the World Health Organization.
Renault Group's factory in Busan, South Korea, where it makes cars sold by Renault-Samsung Motors, was closed from Feb. to Feb. 17 as a precaution against the virus.
Possible supply chain impact
The shutdown in China could have an as-yet unknown impact on Renault factories around the world, the spokeswoman said.
"We cannot restrict the impact of this crisis to a specific geographic area, as all our plants use components from China," she said. "The complexity of the supply chains and the uncertainty about the evolution of the restrictive measures in China do not allow us to give an accurate forecast of the impacts.
She said that Renault was "prepared for this level of crisis" and has worked with suppliers and transport companies on contingency plans.
PSA's operations in Europe are not affected by any parts shortages at this point, the spokeswoman said. "There is no significant impact on group results at this stage," she said.
PSA's joint venture with Dongfeng Motor, called DPCA, has two assembly plants in China, in Wuhan and Chengdu. The plants produce Peugeot and Citroen models for the Chinese and other Asian markets.
It also makes engines and transmissions at a factory in Xiangyang, some of which it exports to Europe. There are r&d centers in Wuhan and Shanghai.
A second joint venture, with Changan Automobile and known as CAPSA, which builds and sells DS models, is in the process of being dissolved. There is an assembly plant, a component factory and an r&d center in the city of Shenzhen in southeast China.
PSA Group sales in China fell by 55 percent in 2019 to 117,084 vehicles, a sharp drop from sales of more than 700,000 in 2014. The automaker presented a turnaround plan in China last September that calls for profitability by 2021 and for volumes to rise to 400,000 by 2025.
Renault's joint venture with Dongfeng, called DRAC, makes the Renault Captur, Kadjar and Koleos SUVs as well as powertrains. The automaker has a separate joint venture with Jinbei Brilliance that makes SUVs and minibuses, with a factory in Shenyang, northern China; a third operation called EGT-NEV makes the City K-ZE electric minicar in Shiyan, west of Wuhan.
Sales in China last year from Renault's three joint ventures were 179,571, a drop of 17 percent from 2018.
