South Korean companies temporarily closed their plant operations in India. The country recently shut down all its nonessential services amid the coronavirus spread.
Hyundai Motor Co. and Samsung Electronics Co. decided to shut down their factory operations across India in line with the country’s effort to contain the spread. As of Monday, the new coronavirus has infected 359 people with seven deaths in the South Asian country.
Samsung Electronics‘ smartphone production facility located Noida, adjacent to New Delhi, would suspend operations from Monday until Wednesday. The electronics company would resume activities on Thursday, as discussed with the Indian government.
The plant, with an annual production capacity of 120 million, is the world’s largest mobile phone factory.
The company also halted its refrigerator production line done at the same facility.
Samsung doubled its capacity in India in 2018 as it aims to lead against China’s budget phone maker Xiaomi. The company’s President Moon Jae-in visited the factory in August 2018.
LG Electronics said it decided to halt operations in both factories located in Noida and Pune until the end of the month. Pune is the second-largest city in the Indian state of Maharashtra, after Mumbai.
LG’s factories mainly produce home appliances, such as refrigerators, air conditioners, and washing machines. Though the Pune factory also manufactures LG smartphones.
Hyundai Motor, Kia Motor
Hyundai Motor, South Korea’s largest carmaker, suspended its plant in Chennai from Monday until next Tuesday. The move came in compliance with the Indian government’s order.
Hyundai Steel Co. also announced it halted its service center and steel pipe plant operating in the southern Indian state of Tamil Nadu. The company is the second-largest steelmaker in South Korea.
The industry also expects Kia Motors Corp., Hyundai’s affiliate, to halt operations of its Anandapur plant sooner or later. The company already suspended its plant in Slovakia until April 3. However, the carmaker still runs its facility located in Georgia, U.S.
Indian Government Measures
The India central government announced the suspension of trains and interstate transport until the end of March. It also imposed a lockdown in 75 districts reported to have positive COVID-19 cases.
Meanwhile, the Maharashtra government banned gatherings of more than five people in public places. It also encouraged employers to allow their workers to work from home. The measure is in line with the practice of social distancing that helps in minimizing the spread of the coronavirus.
India, with a population of over 1.3 billion, is one of the largest markets after China and the U.S. The suspension of the factories would inevitably lead to the South Korean companies suffering from lower sales.