Jaguar Land Rover unsure it will recoup China sales lost to Coronavirus
Jaguar Land Rover Automotive Plc says it may never recoup the sales lost because of the deadly coronavirus outbreak that’s stifled production and kept customers away from dealerships in one of the company’s biggest markets.
“At the moment, we don’t see anything happening in terms of demand in China," Chief Executive Officer Ralf Speth said in an interview with Bloomberg TV.
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“Now the question will be: ‘Will this kind of loss of demand be caught up, or will we just see a normal rise in demand?’ Nobody knows and nobody knows how long it will take."
Automakers have shuttered plants to help contain the spread of the virus, which broke out in Wuhan, known as China’s “motor city." More than 1,800 people have died, and economic activity has slowed with blanket quarantines and travel restrictions. Auto sales plunged 22% across China last month as the outbreak gained momentum, and may sink 30% in February, according to the China Passenger Car Association.
JLR, a unit of India’s Tata Motors Ltd., gets about 20% of its sales from China. While its facility in the city of Changshu near Shanghai is expected to reopen next week, the impact of parts shortages could affect the company’s U.K. production. Its plants have only about two weeks worth of supplies left, Speth said.
The outgoing CEO said he’s “cautiously optimistic" that the U.K. and European Union will agree to a deal that allows for free and fair trade following Britain’s exit from the bloc. Carmakers depend on the complex supply networks that require parts to cross borders multiple times before a car is finished.