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Volkswagen to suspend European production

Wednesday, March 18, 2020

Volkswagen, the world’s largest car manufacturer is implementing plans to halt production at its European sites in the face of the coronavirus outbreak.  

Production is due to be suspended at its plants in Spain, Portugal and Slovakia before the end of the week, while its Lamborghini and Ducati motorcycle factories in Italy will also be shut down. Other plants including its Wolfsburg HQ are also preparing to close down for at least two weeks.

Volkswagen CEO Herbert Diess said, "Given the present significant deterioration in the sales situation and the heightened uncertainty regarding parts supplies to our plants, production is to be suspended in the near future at factories operated by group brands."

Volkswagen, employs 668,000 globally and it is the largest global car maker delivering  10.8 million vehicles in 2019 across its many brands.

Fiat Chrysler , Peugeot and Renault have already closed plants due to coronavirus, while Toyota has also halted production at factories in France and Portugal.

However, there is some more positive news with Volkswagen saying that most of its plants in China were back in production as strict measures in the Far East to combat the virus appear to be paying off.

Containing the virus is obviously the immediate priority in Europe, but when it is contained, carmakers will be very concerned by the global economic slowdown it will cause and the impact this will have on their business. Low consumer confidence will mean new car purchases are unlikely to be a priority for many months to come. This will also mean average vehicle age rises, which may be a positive for the independent aftermarket once some form of business normality returns.