According to investor.hu, stock market panic does not subside in China, and it is already felt by Western companies. Audi gave up its plan to sell 600 thousand cars in the Far East country. In the company’s engine factory in Hungary, production will not increase this year.
Sources, which know the manufacturer’s plans, but wanted to remain anonymous, told Bloomberg that reduction of target figures is necessary because of the Chinese “market situation”. In the stock market of the country, panic broke out a month ago: suddenly everyone wanted to get rid of their shareholding at the same time, so the exchange rates started to fall. In just three weeks, the main stock index, Shanghai Composite fell 34%, due to the fall, a total of USD 4 thousand billion (which is 40 times of the annual Hungarian GDP) disappeared from the investors’ pocket, the value of the companies in the local market reduced that much.
In China’s stock markets, there are a lot of investors with little money, who lost a part of their savings due to the fall of the share prices, so they are forced to postpone their bigger purchases. This year, for example, they will not buy a car – this is what affects Audi.
The company also has a factory in Gyor.
The production of Audi Hungaria Engine Kft. will not grow, albeit not fall – the communication director of the company said. “The engine factory of our company targets last year’s extremely high production level (1.973.734 units) in 2015, as a result the engine factory of Gyor remains the world’s largest engine plant – Peter Lore said. He added, although the engine production will not grow, more finished cars are planned to be manufactured. It is due to that new models are produced in Hungary as well.
The Chinese slowdown affects not only Audi, but also its great competitor, BMW, too. They said to Bloomberg that they expect decelerating growth this year compared to the previous year. Foreign Economic Relations and Foreign Minister Peter Szijjarto said to Figyelo that BMW operated an “invisible factory”, because they buy car parts from several domestic companies. In the Audi factory in Gyor, part are also manufactured for Volkswagen cars and a Mercedes factory operates in Kecskemet. The two companies’ press departments said to Bloomberg they did not plan to reduce the target figures, but Volkswagen added they were “continuously monitoring market events”.
based on the article of investor.hu
translated by BA