Coronavirus: Two-wheeler production affected, EV ecosystem in India expecting disruption on a large scale

Chennai-based TVS Motor Company has said the coronavirus outbreak has impacted the supply of certain components thereby affecting about 10 percent of its planned production for February.

By:February 27, 2020 3:27 PM
Image for representational purposes only

Coronavirus outbreak is a global health emergency and while governments scramble to find a cure as death toll increases, there are other effects of the pandemic that the industries will have to bear. Several automobile manufacturers in India rely on China for import of certain components, especially electric vehicle manufacturers in India currently procure components and batteries from the COVID-19 affected country. We got in touch with some manufacturers to learn more about the possible short- and long-term effects on production. This is what TVS Motor Company and Hero Electric had to say.

Chennai-based TVS Motor Company has said the coronavirus outbreak has impacted the supply of certain components thereby affecting about 10 percent of its planned production for February. The novel coronavirus (COVID-19) pandemic has led to an impact on the supply of certain components for the production of BS-VI vehicles, TVS Motor Co said in a regulatory filing.

“While TVS Motor’s direct dependency on China is limited for components, some Tier II suppliers have been impacted adversely which will lead to a 10 percent drop in the planned production in February 2020,” it said. All efforts are on to normalise this at the earliest, it added.

Commenting on this development, TVS Motor Director and CEO KN Radhakrishnan said, “At TVS Motor Company, we have completely transitioned to BS-VI in the month of January 2020.”

To minimise the impact on the production of BS-VI vehicles, he further said, “We are consistently monitoring developments with those of our suppliers who are sourcing certain components from China.”

At the same time, Radhakrishnan said, “We are also exploring suppliers in other regions and are looking to localise within India. As a customer-centric organisation, our endeavour is to ensure that the impact on our customers and operations is minimal.”

Also read: Honda BS6 bikes and scooters surpass 3 lakh sales mark: Company shifts to 100% BS6 production

As per Sohinder Gill, CEO- Hero Electric, “The majority of the EV and IC vehicle manufacturers across the globe have some fraction of the components imported from China. Coronavirus is a threat beginning to become serious to the EV industry in India due to the lag in the procurement of components and batteries from China. While components can be taken care of to some extent at least in the short run as manufacturers usually keep 2 to 3 months stocks; batteries and battery cells, on the other hand, are imported in small batches and since they come with a limited warranty – manufacturers do not maintain large inventories.

“Coronavirus is yet to be contained and has affected the manufacturing hubs in China; if the spread is not checked, it is likely to disrupt the EV ecosystem in India on a large scale.”

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