Mahindra Says Coronavirus May Jeopardize India Emissions Rollout
Some tier-2 parts for Mahindra come from China.
(Bloomberg) -- Mahindra and Mahindra Ltd. said a component shortage caused by the coronavirus may adversely hit production of certain vehicles and potentially delay India’s shift to a new emissions standard.
“For Mahindra, there are some tier-2 parts that come from China, which right now is a supply constraint for us,” Managing Director Pawan Kumar Goenka said in an interview. “We have some concern if supplies don’t restart next week.”
That could hurt a move to higher emissions standards, roughly in line with Euro 6, by a court set deadline of April 1, he said. The sales of older vehicles has to stop by March 31. If the supply of parts continues to be affected for a few more weeks, Mahindra may have to seek an extension for factors “out of our control,” Goenka said.
Hubei province, the epicenter of the outbreak that has killed more than 560 people, is one of the top auto-industry hubs in China along with Shanghai, Guangzhou and Chanchun, where global manufacturers make both cars and components together with partners.
Hundreds of suppliers have factories in Hubei, including more than half of the top 20 global parts makers, with Robert Bosch GmbH, Valeo AS and ZF Friedrichshafen AG among those producing components there, according to China Automotive Technology & Research Center.
--With assistance from P R Sanjai.
To contact the reporters on this story: Debjit Chakraborty in New Delhi at dchakrabor10@bloomberg.net;Ragini Saxena in Mumbai at rsaxena30@bloomberg.net
To contact the editors responsible for this story: Sam Nagarajan at samnagarajan@bloomberg.net, Abhay Singh, Unni Krishnan
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