"No man is an island that can be all by itself.

Everyone is a piece of the continent, a part of the whole."

This quote is equally appropriate for the global car market under the spread of the epidemic.

As of 17:00 GMT on March 11, a total of 37,371 cases of new coronary pneumonia have been diagnosed in 113 countries and regions outside of China***, with 1,130 deaths*** counted.

"Black swan" affects the global car market

The impact of global economic integration is obvious, the longer the industry chain, the higher the degree of globalization of the industry chain, the deeper the impact. In addition to the obvious catering, hotel, aviation and other industries, the impact of the epidemic on the global automotive industry is intensifying. With the spread of the epidemic, Asia, Europe, North America, and then to Latin America, the global automotive market began to be shrouded in the shadow of the epidemic.

Car companies and suppliers are the main force holding up the entire automotive industry in the global economy. In terms of the overall structure of a car, auto parts, automotive electronics, power batteries, etc. constitute the main supply chain, and like the car companies, these suppliers are not only centralized in their respective parent companies, but also set up production bases in various countries around the world to supply the global car market.

China, the US? , Japan? , Germany, India,? Mexico,? Korea,? Brazil, Spain, and the United States of America. Spain? France is the world's top 10 automobile producers. The top ten global automotive suppliers are The world's top ten parts suppliers are, Bosch (Germany), ZF (Germany), Magna International (Canada), Continental (Germany), Aisin Seiki (Japan), Denso (Japan),? Hyundai Mobis (Korea), BorgWarner (USA), Lear (USA), and Faurecia (France).

Although these producers and suppliers are located in different countries, but still concentrated in Asia, China, Japan and South Korea, the United States and Mexico in North America, and the three major economies of Europe, Germany, France and Italy, as well as the world's important automotive producers.

We made a simple impact index of the impact of the global spread of the epidemic on the automotive industry, the most obvious decline in global auto sales, followed by a narrowing of the decline in revenue, followed by an increase in the level of risk in the supply chain, production stoppages and cutbacks and so on ensued, new cars began to be released on line, the auto show was canceled or postponed, despite the influence of a large and a small, but as a complete industrial chain closed-loop

Reducing sales expectations?

This is a big time for the global auto industry, and a small time for every car company. No one is left alone. As the epidemic spreads, the world is lowering its auto sales expectations one after another?

Jonathon?Poskitt, LMC's director of global sales forecasting, said, "The impact of the new coronavirus outbreak on the automotive industry has been felt far beyond the initial focus on the Chinese market, and will result in downward revisions to forecasts for most major markets around the world.

Morgan Stanley said in an investor report on Wednesday that it expects the new coronavirus outbreak to lead to a 9 percent drop in U.S. auto sales this year.

The China Federation of Passenger Car Associations, which released February production and sales data on Sunday, expects China's auto market in 2020 to realize negative growth of 8 percent.

An Italian trade association warned that car sales in Italy, Europe's third-largest economy, could fall by more than 15 percent.

The new coronavirus outbreak is now affecting Jaguar Land Rover's global sales, which have been adversely affected, especially in China, where sales have fallen dramatically. The company's sales in China plummeted 85 percent in February. In light of this situation, Jaguar Land Rover expects full-year operating margins for fiscal 2019 are expected to fall by about 1%.

Parts supply goes on global alert? Europe North America and Latin America are not spared

The challenges posed by the epidemic are not only at the sales level, but also at the industry chain level, with far-reaching impacts, the variety of automotive parts and components, and the lack of any one of them will make the car companies to stop or have no choice but to press the pause button.

Procurement parts supply global impact is no less than the car companies, their revenue will also end up in the 2020 fiscal year there is obvious. As German parts maker Continental last week blamed the epidemic for the downward revision of its full-year earnings estimate for 2020.In fiscal year 2019, Continental's net profit attributable to owners of the parent company amounted to -€1.2 billion. The previous year's net profit was €2.9 billion.

Some car companies have solved some of their supply problems by chartering flights, a move that can solve immediate problems but cannot guarantee long-term security.

General Motors: GM ships parts on chartered flights to GM's production sites in North America, Brazil, and Argentina, ensuring a smooth global supply chain.

Ford: Ford also recently shipped 94 tons of chartered parts from Pudong Airport to Bangkok, Thailand. Ford has two automobile manufacturing plants in Thailand, which are its important global production bases.

India:? India plans to airlift parts from China in an attempt to contain the impact of China's new coronavirus outbreak on the country's automotive and other industries.

Mexico is the world's seventh-largest producer of automobiles, and automobile manufacturing is also the backbone of Mexico's manufacturing sector, accounting for nearly 3 percent of gross domestic product. In the central Mexican state of Aguascalientes, where two Nissan plants are located, as well as one plant belonging to Mercedes-Benz, Daimler, and the Renault-Nissan Alliance. Some auto plants in Mexico may have to shut down in the coming weeks as the new coronavirus outbreak affects shipments of key components imported from China.

Other parts shortages are also affecting other parts in Latin America. Anfavea, an association of Brazilian automakers, warned that the country's automakers may have to shut down production in April due to a lack of parts from China, where a rapidly spreading outbreak of the new coronavirus has affected the global supply chain.

Three questions about China's auto market in the grip of the epidemic

I. Is the industry chain reshuffling?

According to UBS data, China's auto parts accounted for about 27% of global auto production and 8% of global auto parts exports in 2019. And Japan's imports of auto parts from China were $3 billion in 2019, accounting for about 37% of all Japanese imports of parts, according to the Japan International Trade Center.

As of now, China*** has more than 100,000 local auto parts enterprises. These parts companies create more than 80% of the world's auto parts. Data from the General Administration of Customs for 2019 shows that last year, Chinese auto parts companies exported more than $60 billion, of which foreign subsidiaries of foreign-funded companies in China accounted for 40% of foreign exports.

As of now, China has the world's largest, most complete and well-supported manufacturing system, occupying an important position in the global industrial chain supply chain. The global market is still generally optimistic about the resilience of China's industrial chain supply chain, there is no industrial chain supply chain due to the impact of the epidemic from China to the outside of the phenomenon of large-scale transfer.

II. Will the automotive industry accelerate the process of intelligent manufacturing?

It is well known that the epidemic caused by the inability of personnel to return to work in a timely manner, the labor-intensive industries have a greater impact on the automotive industry, to reduce the dependence on labor-intensive, shall further enhance the level of China's automotive intelligent manufacturing.

Three, China's auto market "danger" and "opportunity"?

"What goes around comes around, and what goes around comes around." For the Chinese car market under the epidemic, the same crisis in the organic.

In the long run, the epidemic is only a short-term "black swan" event. Chinese cars, especially the independent brand, in the overseas market performance has become more and more excellent, Geely, SAIC, Great Wall, BYD as the representative of the car companies, increased overseas market development efforts, which is undoubtedly in the plight of the epidemic in the car companies to alleviate the burden, but also out of a road.

Motivation Watch:

Whether the global supply chain system and the global auto market will see a smooth development after the epidemic is finally over, we are still looking forward to it with confidence. Whether or not there will be another Black Swan event remains to be seen, and 2020 will ultimately be a year to remember in automotive history.

This article comes from the author of the automotive home, does not represent the views of the automotive home position.