China automakers face production suspensions in May, warns XPeng CEO

Automakers in China may have to suspend vehicle production in May if suppliers in Shanghai and surrounding areas are not able to resume work, CEO of Chinese electric-car maker Xpeng, He Xiaopeng, has warned. Due to growing lockdowns in China, highways are clogged and factories are being shut, causing disruptions that are rippling through global supply chains for goods including electric vehicles.

Xiaopeng added that some Chinese authorities are trying to resolve the situation, adding that he hoped that more government departments can provide support on this. His concerns and comments were echoed by Huawei's Consumer Business Group CEO Richard Yu, who also warned of huge economic costs if factories in Shanghai couldn't resume production.

Sales in the world's biggest auto market, China, declined in March due to the effects of Covid curbs. Tesla was among the automakers feeling the pain of the disruptions as it had to shutter its plants for production. The EV maker suspended production at its Shanghai plant since March 28, leading to an output loss of more than 40,000 units. Tesla's Shanghai manufacturing hub makes 10,000 Model Ys and 6,000 Model 3s per week.

Not just Tesla, other automakers such as Nio also suspended production at its Hefei factory in China, even though there were no local-level curbs, but suppliers from other areas had stopped work.

However, now Chinese carmakers with production facilities in the country's northeastern provinces are resuming production as those places are emerging from lockdowns.

State-owned Chinese automaker FAW Group has already resumed some production at its Hongqi plant in Jilin while BMW said all of its plants in the city of Shenyang has restarted operations too.

(with inputs from Reuters)

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