Continued torrential rain in the southern Indian coastal state of Tamil Nadu has led to flooding at a number of carmaker plants around Chennai for the second time in two weeks. Chennai port and airport have been shut for two days and most roads are submerged in several feet of water. There is likely to be no respite for the next five days and conditions are expected to worsen.
As reported on November 18th, what has been described as the heaviest rainfall to affect the area in a decade led to disruption at plants operated by vehicle makers including Ashok Leyland, BMW, Daimler India Commercial Vehicles (DICV), Ford and Renault-Nissan, among others.
While waters had temporarily subsided, continued heavy rain has once again led to flooding and stopped workers being able to get to the facilities, as well as disrupting the delivery of inbound parts and the movement of vehicles outbound to dealers. Tier suppliers have also been unable to manufacture, further complicating the supply chain.
According to a warning issued today by Blue Bird Logistics, all port and airport activities have been shut until further notice and there is no clear indication of the severity of the damage sustained as most areas are still submerged under water.
“The weather prediction for the next five days shows no respite,” said the statement from Blue Bird Logistics. “Heavy rains are expected to only worsen conditions.”
The company went onto warn that port activity could take three weeks to get back to normal.
“As a precautionary measure, Blue Bird Logistics advises against any cargo planning or movement from or to Chennai Port or Airport until further notice,” said the company.
This week BMW confirmed that heavy rainfall had again severely affected the ability of workers to reach its plant in Chennai, which meant it was “not able to undertake any production activities” on Tuesday (December 1st).
“Our aim is to ensure utmost safety for our employees,” a spokesperson for the carmaker told Automotive Logistics, adding that the next steps it took would depend on how the situation developed. “Only if the weather conditions return to normal and employees are able to travel will BMW Plant Chennai resume production tomorrow,” she added.
Ford also confirmed that the significant flooding had made many roads impassable.
“For the safety of our employees, we have halted production at our Chennai assembly and engine plants on Wednesday, December 2,” said a spokesperson for the carmaker. “We are carefully monitoring the situation and will return to normal operations as soon as conditions improve.”
As reported previously, most of the OEMs affected by closures due to the floods are confident of making up the shortfall in production, in part because they are not running at full utilisation and will be able to ramp up production in the coming weeks. The ability of those carmakers to get vehicles to the dealerships, however, remains a problem, with waiting periods of anything up to 10 days reported by Hyundai Motor India.
Collin Noronha, senior research analyst, Automotive and Transportation, Frost & Sullivan backed that figure up, noting that dispatches had been delayed by the flooding and there was a lot of stock sitting in yards, as well as vehicles already shipped out from the plant but stuck in transit.
“The bad rains and unsafe conditions mean some of these deliveries are going to be delayed by between 7-10 days,” he said. “So any customers that were expecting their vehicles some time this week are now very likely to receive them from the end of next week, or the beginning of the week after.”
The infrastructure challenges affecting carmakers in India will be under discussion at next week’s Automotive Logistics India conference in Delhi, which begins on Tuesday 8th. Learn more and register here
