September 06, 2017 13:02
Production stopped again on Tuesday at a Hyundai car plant in Changzhou, China.
According to Hyundai, a parts maker that supplies air intakes to Hyundai in Beijing stopped delivering on Monday citing outstanding payment. The company had sent an ultimatum for Hyundai to pay up by Aug. 31.
Hyundai's failure to do so brought the plant to a halt. If parts inventories become depleted, the other three Hyundai factories in China will have to stop production as well.
Late last month, a parts maker in China stopped supplying Hyundai because it had not been paid, halting production at all four of Hyundai's plants there for three to five days.
Sporadic production stoppages could continue in the future unless Beijing Hyundai Motor, a joint venture with China's BAIC, sorts out its cash flow. BAIC, which takes care of finance for the joint venture, has still not paid the parts maker that was responsible for the previous stoppage, despite a decision by Hyundai headquarters to inject billions of cash into the ailing Chinese operation that has been hit hard by an unofficial boycott there.
One industry source said, "BAIC is calling on Korean parts makers in China to slash prices by 20 percent. The situation is becoming worse since BAIC is not showing any signs of trying to pay the money it owes."
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