European car plants reopen, with output well below capacity

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Most European auto assembly plants have reopened after weeks or even months of inactivity under coronavirus lockdowns, but few are operating at anything close to full capacity, automakers and analysts say.

Among the reasons are safety measures to prevent the further spread of the virus, little visibility on demand and the need to draw down existing inventories that swelled when dealerships closed.

Volkswagen Group says that all of its factories in Europe are open and are running at 60 percent to 90 percent capacity. All of Renault Group’s factories are running again, including in Morocco and Romania, but some have gone down to two or even one shift from three to reflect demand. At the same time, however, Volvo says output at its factory in Ghent, Belgium, is back to its pre-pandemic level.

Pete Kelly, managing director at forecaster LMC Automotive, said it was reasonable to assume that about 90 percent of assembly plants in Europe were operating, at an average of 50 percent capacity. 

“It will be changing all the time,” he said told Automotive News Europe. Automakers “are concerned about infections, so they can’t move back to the same build rates. But they can change shift patterns, and they have some levers to pull to get back to normal,” he said. LMC estimates that global automotive utilization rates will be well below 50 percent this year. 

When Renault Group negotiated a back-to-work agreement with unions, for example, it built in flexibility to add shifts and work through the usual holiday break. PSA’s factory in Sochaux, eastern France, where it builds the popular Peugeot 308, 3008 and 5008 models, will be working on certain Saturdays this summer.

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Saurabh Shukla

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