MCO 3.0 has now lasted more than 70 days, even though were are now at the National Recovery Phase, Selangor is 80 percent shut with most of the economic sector now allowed to open. This long period of closure is dealing a massive blow to the mega industry including the automotive sector.
With the whole supply chain unable to function the financial impact is unimaginable, despite manufacturing being halted and showrooms not selling cars, operational and staff cost continues. Naza Automotive Group, the automotive arm of the Naza Corporation Holdings has voiced out its concerns and is appealing to the government to allow the automotive sector to resume operations. The cry does not only come from the local player, there is already rumbling among other players who are also on similar tone.
NAZA Group’s Group Chief Executive Officer, Dato’ Nik Hamdam Nik Hassan highlighted that many of the key automotive companies for both production of vehicles and components are located within Selangor and Wilayah. Prolonged business and supply chain disruption will have dire consequences on the industry, especially due to the fact that the local automotive industry is highly dependent on the domestic market. The continued shutdown of vehicle sales, production and distribution of motor vehicles, components and spare parts, closure of showrooms and distribution centres and complete shutdown of operations would lead to eventual closure of businesses especially for the smaller industry players. Inevitably, this scenario would bring about lay-offs and probable deep and long-lasting impact to the job-market.
There has been talks of the government easing restriction on the economic sector during the Phase 1 of the recovery (Selangor) however this will be done with strict SOP compliance. Its extremely difficult to balance the safety and reopening during this time of uncertainty as cases continue to rise. But NAZA points out that vehicle owners are also at risk of using under-serviced vehicles with the inability to replace damaged parts.
A more targeted approach on which sector to close and which to open, a structures SOP and guideline can apply for different field and strict enforcement will be critical to prevent outbreaks from occurring.