In response to falling sales many car makers around the world have announced temporary shutdown of their assembly plants. The severity of the situation was evident from the recently published photos of unsold new cars parked in ports, factories, etc. in various countries. A sample photo is shown below.
Photo: Imported cars stored at Sheerness open storage area awaiting delivery to dealers
Credit: David Goddard/Getty
Source: The Guardian, UK
For more photos go to: Growing stocks of unsold cars around the world
As ports and other places struggle to keep up with the unsold inventory, car makers in Europe have announced shutdowns of a few days to two months or more. A study by the Policy Department of the European Parliament compiled the various factory closings in Europe.
Listing of Shutdowns of Major Vehicle Assembly Plants in Europe
(click to enlarge):
In addition to car makers, auto parts suppliers have also been affected. Some of them have announced temporary closings of their plants as shown below:
Source: Impact of the Financial and Economic Crisis on European Industries,Policy Department Economic and Scientific Policy, March 2009, European Parliament
European car makers deal with over 800 suppliers procuring parts worth about 30B Euros per year.
According to the paper mentioned above, at this stage of the recession, “even a marked improvement in availability of vehicle financing now would not prevent the market falling heavily for the rest of the year”.