For Most Globalized Industry Coronavirus Pandemic Is A Choke-Hold

As the Coronavirus pandemic spreads, the automotive industry is particularly at risk as the most highly evolved globalized production and distribution network, with China as its fastest growing marketplace and most prolific manufacturing base.

Throughout China industrial modernization, its accession to the World Trade Organization (WTO) in 2001, and a middle class and private wealth explosion, has created a robust domestic auto sector. In addition to Chinese carmakers, every major international auto brand has staked its future and growth to huge investments in making and selling cars in China.

Even more ominously, a supply chain manufacturing boom with a hub in — of all places Wuhan — provides essential parts for auto makes and models built and sold all over the world, and most prominently the US and Europe.

The Coronavirus is already having enormous impact on the economy and productivity in China, and as a major link in the global automotive parts and component supply chain, the US and other major international markets are bracing for a very rough ride, with slowdowns in new car demand, deliveries and cascading financial impact throughout the general economy.