Volkswagen Group is the automaker most exposed to the coronavirus outbreak in China, according to Standard & Poors.
VW Group produces and sells almost 40 percent of its cars in China, and while its main plants are outside of the epicenter in Hubei province, they are likely to be closed for extended periods by government restrictions aimed at combating the disease, S&P said in the report issued Wednesday.
At risk are about 3 billion euros ($3.3 billion) in dividends that Volkswagen’s Chinese joint ventures pay to their German parent, according to the report from S&P analysts led by Vittoria Ferraris.
The virus forced S&P to rip up its forecast for a recovery of the Chinese market after two down years. Sales in the world’s biggest automotive market are no longer expected to meet the analysts’ base case for 1 percent to 2 percent growth in 2020.
Nissan was singled out for having relatively high risk “considering its high exposure and recently weak performance,” S&P said.
Honda has a production base in the outbreak city of Wuhan and relies on China for 30 percent of sales and output, the analysts said.