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US automakers to shut plants due to COVID-19 epidemic

The “Detroit 3” car makers include General Motors, Fiat Chrysler and Ford that will halt operations throughout North America through the end of this month. Detroit (AFP) – US automakers announced Wednesday (March 18) they will temporarily shut down North American production as the economic hit from the coronavirus spreads to manufacturing. The companies announced in conjunction with the United Auto Workers, the “Detroit 3” car makers including General Motors, Fiat Chrysler and Ford that will halt operations throughout North America through the end of this month. That move comes only hours after the companies had previously said the plants would be kept open with modified procedures to employ social distancing in manufacturing. But that deal was put aside after Honda Motor Co said that they would close North American factories for six days because of declining demand. In addition, a worker at a Ford assembly plant in Michigan tested positive for SARS-CoV-2 causing COVID-19. UAW officials admitted privately they were facing a situation where absenteeism was increasing as schools closed in states such as Michigan and Ohio. Besides, employees were refusing to work after co-workers tested positive for the SARS-CoV-2 virus. The closure of the three “big” factories also affected Canada. Unifor, the union that represents Canadian workers, is also under pressure from members to withdraw their employees. It is not just American automakers that have to close factories in North America. Japanese automaker Nissan Motor Co also recently said they would stop production at US facilities starting March 20 through April 6 to intensify efforts to prevent the spread of COVID-19. Nissan says there have been no confirmed cases of COVID-19 in any of their facilities. Another Japanese automaker, Toyota Motor Corp, said they would close North American factories for two days next week. Similarly, South Korean carmaker Hyundai closed the assembly plant in Montgomery, Alabama on the morning of March 18 after an employee tested positive for COVID-19. No details information on when the factory will reopen. So far, Detroit 3 manufacturers have not any profit warning yet. Fiat Chrysler said they will update financial forecast when they have a clearer assessment of the impact of the disease on the market. However, according to the Car Market Research Center (CAR) in Ann Arbor, Michigan state, the US government will also feel the “pain” of car manufacturers. The center forecasts that Washington will lose $ 2 billion in tax revenue if sales of the entire US auto industry are delayed for a week. But not all automakers shut down factories in North America. Some companies still operate assembly plants in this area include BMW in Spartanburg, South Carolina state; Kia Motors Corp at West Point, Georgia state; Mercedes of Daimler AG in Vance, Alabama state; Volvo Cars in Ridgeville, South Carolina state and Volkswagen AG in Chattanooga, Tennessee state. Tesla Inc also operates the plant in Fremont, California, on Wednesday (March 18) although local officials have announced that the plant cannot continue operating when the San Francisco Bay area begins to blockade in three weeks.