Hyundai Motors has temporarily closed one of its key factories in Ulsan, South Korea, after workers tested positive for coronavirus.
The automaker share price fell 4.96 per cent in Friday trading to close at 115,000 KRW. This outdid the Korean Stock Exchange KOSPI Index, which suffered a 3.30 per cent loss.
In a statement Hyundai said: “The company has also placed colleagues who came in close contact with the infected employee in self-quarantine and taken steps to have them tested for possible infection.”
While the company asserted that it was disinfecting the factory and hoped to restart activity as soon as possible, this latest development is but another blow for the automaker. Hyundai was forced to scale back production at a number of plants in recent weeks following a shortage of Chinese parts.
China’s economy has ground to a halt as a result of the epidemic and widespread quarantines. Carmakers beyond China have had to deal with the significant disruption of their supply chains, while the leading Chinese auto-industry body has predicted a drop in sales of more than 80 per cent.
South Korea has the most infected people outside China, reporting 256 new cases on Friday alone. With five factories less than an hour away from the South Korean epicentre in Daegu at Ulsan, the virus has the potential to severely affect Hyundai’s production ability.
The care complex at Ulsan is the world’s largest with Hyundai employing 34,000 people to produce 30 per cent of its global car output.
With high population density and an economy dependent on exports, South Korea is particularly exposed to the ravages of the coronavirus outbreak.
The country’s leading conglomerate Samsung saw its share price fall by 3.04 per cent in Friday trading. Directly employing more than 100,000 people in South Korea and contributing 12.5 per cent of the country’s gross domestic product last year, any disruption to this firm would not only severely hamper the South Korean economy but also the South Korean government – 12 per cent of the country’s total corporate tax revenue came from Samsung alone.