Hyundai pauses Korea production in response to coronavirus

Hyundai Motor has confirmed it will suspend production in South Korea due to major disruption in the supply of Chinese-made parts as a result of the coronavirus.

The Korean car-maker is the first automaker outside China to pause production at its seven factories and it not set to resume manufacturing until February 11, at the earliest.

Thought to affect as much as 40 per cent of its global output, the US, Europe, Middle East and many other countries including Australia are also set to be affected by the shutdowns.

The biggest coronavirus-related hit to production is said to involve a crucial shortage of wiring harnesses sourced from factories in China.

In response to the move, the affected suppliers Kyungshin and Yura Corporation have both announced that they had already boosted production at their factories in South Korea and Southeast Asia to offset the Chinese supply issues.

Both suppliers have also stated that it was their intention to resume production at the Chinese factories as soon as February 9.

Like most modern car-makers that operate on a just-in-time manufacturing process, both Hyundai and Kia do not keep large stocks of the affected parts.

Analysts commenting on the Hyundai Motor's forced closure of its plants point at the South Korean car-maker was more exposed to supply issues from China than any other car-maker.

In 2019, alone, Hyundai Motor reportedly imported $1.56 billion ($A2.3bn) worth of Chinese parts.

Tesla, Ford, PSA Group, Nissan and Honda have already suspended production within China following the outbreak of the virus that has seen many factory workers struggle to reach their jobs following extended Chinese new year holidays and the suspension of public transport in affected cities.

Commenting on the shutdowns, Hyundai said it was working to minimize disruption, issuing the statement: "Hyundai Motor will closely monitor developments in China and take all necessary measures to ensure the prompt normalization of its operations.”