BMW Munich Welt

This week, BMW instructed 150 employees in its Munich, Germany research and development center to self-quarantine after an employee tested positive for the human coronavirus that is currently spreading around the globe. Although BMW has reported that the employee is doing well given the circumstances, it is not known how the individual contracted the coronavirus, as they had not recently traveled internationally.

This week in Germany, the reported number of coronavirus cases has surged to over 700 at the time of this writing. All but one of Germany’s sixteen states have reported cases, with 117 in Bavaria, where BMW is headquartered. According to the automaker, the viral threat has not disrupted operations, and the area where the infected individual worked was swiftly cleaned and disinfected.

The same cannot be said for global manufacturing operations, however, or important events like the Geneva Auto Show, where automakers like BMW were scheduled to unveil a host of new vehicles and ideas this week, like the new i4 Concept. Last week, the Swiss government banned gatherings of over 1,000 people, and the rest of the European states are said to be considering enacting similar restrictions.

In China, the world’s largest manufacturing base, production remains at a fraction of what it was, but the reported slowing of new infections in the country has the communist government encouraging factories to slowly resume operations. The orders have been directed at low-risk areas, and not where the disease originated, the large manufacturing hub of Wuhan, located in the Hubei province. Auto factories in China slowly began to reopen during the second half of last month, including the BMW Brilliance manufacturing facility in Shenyang, but little has been reported since, and countless employees remain stranded either from Chinese lunar new year travel, or the cancellation of regular bus and train service throughout the country.

Factories in China producing everything from toys to circuit boards are doing their best to get employees back to work, but a significant portion of the workforce remains unable to attend, either due to travel restrictions or fear of infection. Companies small and large are said to be providing masks and performing regular workplace disinfection routines.

How the spread of the virus and subsequent government responses will influence the global economy over the larger term remains to seen, given the severing of crucial supply lines and temporary shuttering of the world’s second largest economy. Bloomberg has reported that, in addition to a major supply disruption, the virus is also responsible for a drop in demand, as people all over the world skip eating out, avoid shopping, and shy away from gatherings and events. After posting 6% growth for the fourth quarter of 2019, these Chinese economy is expected to either contract or remain flat for Q1 2020, while UBS economic analysts think exports may have fallen around 17%. Although governments and central banks the world over have stepped up with rate reductions, low-interest loans, and other forms of assistance, some companies simply won’t be able to survive after going so long without revenue.

After the cancellation of this week’s Geneva Auto Show, BMW opted for a virtual reveal of the new Concept i4, while the rest of the world awaits the latest developments in the spread of the virus and how it will effect manufacturing.—Alex Tock

BMW Munich Welt

[Photos courtesy BMW AG.]



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