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Multinationals Yamaha, Chevrolet, Volkswagen, and Fiat Treat the Event as a Suspension, Not a Definitive Cessation of Production in Brazil
After Ford’s exit from Brazil, the global supply crisis and the pandemic caused numerous car factories, such as Chevrolet, Honda, Audi (Volkswagen), Scania, Volvo, and Mercedes-Benz, Renault, Nissan, and Fiat to suspend vehicle production. The event also reached Yamaha, and the country’s automotive industry could collapse.
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Yamaha decided to suspend activities in some of its motorcycle production lines from May 3 to 12 due to the adverse situation in the supply chain resulting from the supply crisis caused by the coronavirus pandemic, aiming to adjust the flow of incoming supplies.
With the measure adopted by the company, employees belonging to the affected lines will be on collective vacation.
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Not Only Yamaha, but Its Competitor Honda Also Suspended Motorcycle Manufacturing
According to the company, the production of outboard motors as well as other operational activities of Yamaha Motor da Amazônia, Yamaha Motor Components da Amazônia, and Yamaha Logistics will remain fully operational during this period.
The Honda Motorcycle Division in the Amazon also reported a temporary halt in its production line at the beginning of the year. Activities were also suspended at that time due to the impacts of covid-19 on supply chains, resulting in unavailability of inputs for production and the worsening of the pandemic.
Fiat and Chevrolet Also Faced Problems with Component Shortages
Fiat’s factory in Betim halted the second shift of production due to a lack of inputs, leading 1900 employees to take vacation for an initial period of 10 days.
Fiat did not disclose the volume of vehicles that will not be produced, nor the most affected models in this stoppage. In March, the automaker also had to halt production for the same reason.
The automotive market shows signs that it will still face difficulties in resuming the sales pace of the pre-pandemic period, and automobile manufacturers have more reasons to be quite concerned.
The most serious situation is with Chevrolet, which halted production at the Gravataí (RS) plant, where the Chevrolet Onix is produced, during April and May, with effects still in June, due to the impact of the coronavirus on the supply chain.
Fiat and Chevrolet face similar problems due to the global shortage of available components. Industries that rely on raw materials to produce their products can no longer meet the demand to manufacture their goods in sufficient quantities.
The Consumer Will Also End Up Paying This Bill
In any case, it goes without saying that the consumer will also end up paying this bill. In the case of the Chevrolet Onix, for example, there is a risk that market demand will greatly exceed the available supply—in other words, prices are likely to increase.
For now, other manufacturers operating in Brazil have not indicated the risk of halting production, but the Volkswagen Group has already stated that it will experience a global reduction in production of 100,000 vehicles in the early months of this year due to the shortage of raw materials.
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