Chennai Floods to Disrupt India Car Production, Auto Group Says

INDIA-FLOODS-WEATHER-DISASTER

Flood affected areas in Chennai, India, on Dec. 5, 2015.

Photographer: AFP via Getty Images
  • Automakers, component manufacturers gauging extent of impact
  • Renault-Nissan Chennai factory lost output of 10,000 cars

Heavy rain in the southern Indian city of Chennai will disrupt auto manufacturing because the ensuing flooding disrupted the production of components needed by carmakers, according to a manufacturers group.

The output of vehicles this month will be lower due to a shortage of components, Vishnu Mathur, director-general at the Society of India Automobile Manufacturers, said in New Delhi Friday, without being more specific. PriceWaterhouseCoopers LLP estimates that more than a third of India’s auto production comes from the Chennai region and it will take at least one month for production to return to normal.

Automakers and parts manufacturers are gauging the extent of the impact from the unprecedented floods this month that inundated Chennai with a threefold increase in seasonal rainfall. Renault SA and Nissan Motor Co. said Thursday they lost output of 10,000 cars at their joint factory after it had to shut for seven days in November and December.

“There will be a significant impact on car sales, both domestic and exports, from the flooding in Chennai,” said Abdul Majeed, a partner at PriceWaterhouseCoopers in Bengaluru. “The extent of damage is still being assessed.”

Renault-Nissan, which resumed operations Dec. 6 after disruptions earlier this month due to floods in the region, said some of its smaller suppliers have been “adversely affected” and it’s helping them get back on track. There was no damage to its factory and warehouse, it said.

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