TVS Motor sees 10% drop in production as coronavirus hits parts supply
Indian scooter manufacturer TVS Motor Co Ltd said on Monday it expects a 10% drop in February production as the supply of components used in vehicles is being hit by the coronavirus epidemic.
Companies globally, including Apple Inc, have warned that the spread of the epidemic in China, the world's second-largest economy and a big manufacturing hub, is disrupting global supply chains and hurting profits as factories and shops shut operations.
"The outbreak of pandemic coronavirus (COVID-19) has led to impact on supply of certain components for production of BS 6 vehicles," the company said in a statement, referring to cleaner emission standards enforced by India's government.
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"While TVS Motor's direct dependency on China is limited for components, some Tier II suppliers have been impacted adversely," TVS said.
TVS, the third-largest maker of two-wheelers in India, is also exploring suppliers in other regions and is looking to localise its supplies within India, it added.
The company's local rival, Hero MotoCorp Ltd, said last week it was monitoring the coronavirus situation and any loss resulting from the outbreak was not yet "quantifiable."
Jaguar Land Rover, Britain's biggest carmaker and a unit of India's Tata Motors Ltd, said last week it was flying Chinese parts in suitcases to Britain to maintain production and could run out after two weeks.
On Monday, fears of the coronavirus pandemic grew after sharp rises in new cases reported in Iran, Italy and South Korea, but China relaxed restrictions on movements in several places including Beijing as its rates of new infections eased.