German automaker BMW said on Wednesday it will shut down European and South African plants, which will account for half its production, per month, which is in line with other auto giants affected by coronavirus containment measures.
He also warned that this year’s earnings will be significantly lower as a result of the crisis. “Starting today, we will close our European car plants and the Rosslyn factory in South Africa,” said Oliver Zipse, CEO, adding that the break is expected to last until April 19. BMW factories across Europe, in Bavaria, elsewhere in Germany and beyond, along with a plant in South Africa, accounted for half of the 2.56 million vehicles the group built in 2019. Across Europe, others Manufacturers, including Mercedes-Benz, the parent company Daimler, Volkswagen, Ford, Fiat and Peugeot, also closed the factory doors due to the coronavirus crisis. “For many products, the demand for cars will plummet,” due to the virus and related containment measures, said BMW Zipse CEO.
He added that the Munich team uses “very flexible and effective work time tools” that can help mitigate the impact. The German government has already simplified the rules governing the remuneration of workers whose hours decreased during the crisis.
BMW Chief Financial Officer Nicholas Peter said the group currently expects pre-tax earnings this year to be “significantly lower” than the 7.1 billion euros ($ 7.8 billion) reported in 2019. “The measures related to the coronaviruses will have a significant impact on the course of our business, “said Peter.