Global Auto Industry Faces First Quarter Earnings Hit from COVID-19

[Image source=AP Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] The global automotive industry in the United States and Europe has been directly hit in the first quarter due to factory shutdowns and a sharp drop in demand caused by the impact of the novel coronavirus disease (COVID-19).

According to local media on the 30th, Fiat Chrysler, one of the Big Three U.S. automakers, reported a 10% decrease in first-quarter sales compared to the same period last year. Fiat Chrysler stated, "Sales sharply declined in March due to the spread of COVID-19."

General Motors (GM), one of the major U.S. automakers, also announced that its first-quarter sales fell 7% year-on-year as car sales plummeted in March due to the COVID-19 impact.

Ford, which announced its first-quarter results on the 28th (local time), also experienced a sharp decline in performance. Ford reported a net loss of $2 billion (approximately 2.4 trillion KRW) in the first quarter. Revenue was $34.3 billion, down 14.9% from the same period last year. EBITDA recorded a loss of $632 million. Ford expects EBITDA to worsen further to $5 billion in the second quarter.

The situation is similar for major European automakers. Daimler, the parent company of Mercedes-Benz, reported a 68.9% plunge in first-quarter operating profit to 719 million euros (approximately 956.8 billion KRW) compared to the same period last year. Volkswagen also announced that its first-quarter operating profit fell 81% to 900 million euros (approximately 1.1976 trillion KRW). BMW's first-quarter sales declined 20.6% year-on-year.

The Japanese automotive industry was not spared from the COVID-19 shock. The total production volume in March (including overseas) announced by eight major Japanese automakers, including Toyota, Nissan, and Honda, decreased by 26% compared to the same month last year. This decline was larger than the 15% drop in the previous month.

By company, Toyota Motor produced 640,973 units in March, down 20.6% from the same month last year. Domestic production in Japan decreased by 13.2%, but the larger impact came from a 25.5% drop in overseas production. Honda and Nissan produced 275,388 and 261,975 units respectively last month, showing a year-on-year decrease of 42.6% and 41.4%.

Meanwhile, Toyota plans to resume operations at some North American plants on May 4, and Honda aims to restart its plants on May 11. GM, Ford, and Fiat Chrysler are scheduled to reopen their factories on May 18.

This content was produced with the assistance of AI translation services.