Volkswagen Group Suspending Operations, Closing Plants in Europe to Curb Coronavirus

Volkswagen Group Suspending Operations, Closing Plants in Europe to Curb Coronavirus

Volkswagen Group will cancel production this week at factories in Italy, Slovakia, Portugal, and Spain and is mulling over shutting down the rest of its assembly lines across Europe due to the spread of coronavirus, its CEO stated Tuesday.

Volkswagen Group Suspending Operations, Closing Plants in Europe to Curb Coronavirus

The German car manufacturer, which owns the Bentley, Bugatti, Audi, Ducati, Lamborghini, Porsche, Seat and Skoda brands, stated the ambiguity concerning the fallout from the coronavirus pandemic meant it was impossible to give any estimates for its performance this year.

Volkswagen’s works council has concluded it’s not possible for staff at its plants to maintain a safe distance from one another to prevent contagion and suggested a suspension of manufacturing from Friday.

Production will be paused at VW’s Spanish factories, in Setubal in Portugal, Bratislava in Slovakia and at the Lamborghini and Ducati manufacturing facilities in Italy before the end of this week, Diess stated.

Most of its other German and European plants will prepare to shut production, probably for two to three weeks, VW said.

Last month, the car and truck manufacturer stationed in Wolfsburg in Germany predicted that vehicle deliveries this year would be stable at 2019 levels and forecast an operating return on sales between 6.5% to 7.5%.

Volkswagen Group further stated its full-year operating revenue surged 22% to 16.9 billion euros ($18.5 bn) thanks to robust sales of higher-margin automobiles and lower diesel charges, battling an industry slowdown that hurt competition.