Coronavirus: Volvo cars to temporarily close plants in U.S. and Sweden

Volvo is suspending production at its factories in Sweden, the United States and Belgium, to curb the spread of the coronavirus, even as it resumes manufacturing in China where the infection rate has slowed.
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| Updated on: 20 Mar 2020, 01:56 PM
File Photo. (REUTERS)
File Photo. (REUTERS)

Swedish carmaker Volvo is suspending production at its factories in Sweden, the United States and Belgium, to curb the spread of the coronavirus, it said on Friday, even as it resumes manufacturing in China where the infection rate has slowed.

Volvo's Swedish factories in Torslanda, Skovde, Olofstrom, and its U.S.

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plant in South Carolina will close between March 26 and April 14, the company said. Its plant in Ghent, Belgium has already been temporarily shut down.

"Our primary concerns are the health of our employees and the future of our business," Chief Executive Hakan Samuelsson said. "I think for the economy, we need to do something drastic, rather then trying half-hearted measures that drag on forever."

(Also read: Volvo Cars India asks employees to work from home amid coronavirus outbreak)

"We are seeing the effect from this coronavirus is increasing every day. We see problems in the logistics supply side," he told Reuters. "We have to help contributing to social distancing."

Samuelsson said the financial impact of the shutdown would become clearer when the carmaker published first-half earnings. The company will reduce the working hours of white-collar staff during the factory closures and will take advantage of government incentives, Samuelsson said.

(Also read: Bentley to suspend production for four weeks over coronavirus outbreak)

The financial impact on Volvo also depended on how different countries reacted to contain the virus.

"There is a big difference between countries. Some have curfews, with restaurants and schools closed. In other countries there are less drastic measures. I just think we need to synchronise that more."

First Published Date: 20 Mar 2020, 01:56 PM IST
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