As the number of infections caused by the coronavirus outbreak rises, the human cost is tragic. However, the cost to businesses around the world could also become direr in the weeks to come. Manufacturers around the world have come to depend on China for the parts to keep their supply chains going. Now that China’s factories and plants have ground to a halt in the face of the outbreak, there are many who fear that the implications can be felt around the world.

Most notably, the automotive sector is one of the hardest hit. Auto plants around the world strongly depend on the Chinese auto parts industry, which is massive. China is a major supplier of parts to auto plants around the world, from computer chips down to screws and bolts. The thing about Chinese auto parts is that they are not always classified the same way as how you would classify a bumper or an engine piston. Chinese parts are often used in auto parts that are built in other countries.

The fact remains that you cannot build a car even if you have 99% of its components. With a large percentage of these parts used in automotive assembly lines around the world, this may have a huge impact on the production of cars.

"It only takes one missing part to stop a line," said Mike Dunne, a consultant to the auto industry in Asia and the former head of GM's operations in Indonesia.

Finding replacements for all those parts is not practical if the supply continues to be disrupted, said Kristin Dziczek, vice president of the Center for Automotive Research.

"It's difficult to say when it will start to bite here," she said. "I would expect to see a cascading global impact by the end of February if Chinese production doesn't come back. All automakers have a supply chain war room going on right now to determine what they can be doing. But China is so huge, there is no way they cannot be impacted."

So far, most of the auto assembly plants in China remain closed as the coronavirus continues to spread. The impact in China is not as widespread, as these plants primarily serve the Chinese auto market. However, the lack of parts has already started to affect plants around the world.

Notable mentions include Hyundai’s South Korean plant due to a lack of Chinese parts, Nissan’s plant in Kyushu, Japan because of “production adjustments” due to shortage of Chinese parts and Renault’s plant in Busan, South Korea, also due to disruptions in supplies for Chinese parts. Most other automakers are monitoring the situation closely, but experts believe that the global auto industry hasn’t felt the full impact of the virus outbreak.

"At the moment it's rather difficult to tell," said Simon MacAdam, a global economist at Capital Economics in London. "A supply chain is only as strong as the weakest link. That's why there's such uncertainty about estimates."

The prospect of widespread halts at global auto plants becomes a lot more likely if the plant shutdowns continue, he said

Even if the plants try to reopen, it's not clear if they'll be able to operate as normal due to potential labour shortages, or in the worst-case scenario, further spreading of the disease, Getting the parts shipped will also be difficult due to the travel restrictions imposed by different countries.

All we can do now is continue to monitor and hope that the coronavirus will eventually be cured and those affected by it will stay strong in the face of adversity.

Is Coronavirus Wrecking Automotive Industry?