Tension in the Auto Industry over Omicron Emergence... "It Will Last Until Mid-Next Year"

[Asia Economy Reporter Yujin Cho] The emergence of the new variant virus Omicron is causing tension in the global automobile manufacturing industry. The industry is closely monitoring whether the spread of the new variant will lead to production disruptions in the automotive sector, which is already facing a crisis due to semiconductor supply shortages.

According to major foreign media on the 30th (local time), a spokesperson for Nissan in the Americas said, "This variant is completely new," and added, "We are closely monitoring the situation." In Japan and the UK, where Nissan's headquarters and production plants are located, the first confirmed cases of Omicron have been reported, triggering an emergency. Senior executives of Toyota's U.S. subsidiary also held an emergency meeting on the same day to discuss the Omicron situation.

General Motors (GM) in the U.S. also stated, "We are closely monitoring the situation," and "We are operating plants in compliance with health authorities' guidelines, and currently, there are no changes to future schedules." Since information on the vaccine effectiveness and fatality rate of the variant is still limited, it is too early to predict the impact of Omicron on the automotive industry, and they intend to keep a close watch on the situation.

With U.S. Secretary of Commerce Gina Raimondo saying the day before that it is still too early to discuss how Omicron will affect global supply chains, industry concerns are growing.

(Photo by Bloomberg)

Meanwhile, French automaker Renault predicted that the semiconductor supply shortage crisis will continue at least until the middle of next year. Luca de Meo, Renault's Chief Executive Officer (CEO), said in an interview with Bloomberg News on the same day, "To meet high market demand, we will prioritize the production of profitable vehicles and respond to (production disruptions) accordingly."

Renault's Flins plant in France has been shut down for two years due to the COVID-19 pandemic and the resulting semiconductor supply shortage. This is the first time in 70 years that the Flins plant has stopped its production line. CEO de Meo expressed a sense of crisis, saying, "The supply chain is in disarray, with employees being urgently dispatched to Asia to secure semiconductor chips."

Renault expects production disruptions due to the semiconductor chip shortage to reach 500,000 units this year alone. This accounts for about one-fifth of last year's total production volume.

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