April 14, 2020 / 1:50 PM / 2 months ago

Hyundai first to restart Czech production, others still shut

PRAGUE (Reuters) - Hyundai Motor Co’s (005380.KS) Czech car plant was the first in the central European country to get back to work on Tuesday after a three-week outage, potentially easing some of the strain on the hard-hit economy.

FILE PHOTO: Hyundai's logo seen on its Vision T concept car at the LA Auto Show in Los Angeles, California, U.S., November 20, 2019. REUTERS/Andrew Cullen

The car sector accounts for a tenth of economic output and a quarter of exports in the Czech Republic, and employs 150,000 directly and even more indirectly.

All three of the country’s major carmakers have been offline since around the middle of March as part of efforts to curb the coronavirus and authorities have forecast at least a 5% economic contraction this year.

Yet while Hyundai’s plant in the east of the country returned to work, there was gloomier picture elsewhere. TPCA, a joint venture of Toyota Motor Co (7203.T) and Peugeot (PEUP.PA), said it would extend its outage to May 4, scrapping plans to relaunch later this week.

The country’s top exporter, Volkswagen’s (VOWG_p.DE) Skoda, is for now planning to leave workers at home until April 27.

By contrast tiremaker Continental (CONG.DE) relaunched its Czech plant employing over 5,000 in the east of the country with limited production on Tuesday, having temporarily halted it last month.

Hyundai, whose output of 309,500 cars last year was nearly all for export, said it would run two out of three shifts. The down shift will be used for disinfecting operations.

The virus’s outbreak has put most of Europe on lockdown and left numerous factories idled. The car plant closures have hit auto part makers along the supply chain.

The Czech government has introduced aid schemes for companies and workers hit by measures to curb the virus.

The Czech Automotive Industry Association said at the beginning of April that 90% of the sector was crippled by the crisis and a third was forced to halt operations.

Reporting by Jason Hovet and Robert Muller; Editing by David Holmes

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