The coronavirus outbreak that is causing alarm and disruption in China as millions of people travel for the Lunar New Year is also having a major impact on brands, both domestic and international, although many are stepping up to help.
Wuhan, where the first cases of the disease were reported, was placed in quarantine last Thursday, along with four nearby cities, and there could be serious consequences for Renault, Honda and PSA Group, which all have large manufacturing plants there.
Similarly, shares in global luxury goods companies like LVMH took a hit last week amid concerns that travel restrictions could have a significant impact on sales during the two-week holiday period when Chinese shoppers usually spend more.
It’s also more likely that Chinese tourists will opt to stay at home rather than travel overseas on shopping sprees, the BBC reported. Meanwhile, several popular tourist attractions, such as the Forbidden City in Beijing and Disney’s mega-resort in Shanghai, have shut down for the time being.
In addition, at least seven movies slated for the New Year have been postponed and many Chinese cinemas have been forced to close for the normally lucrative holiday.
Although on a more positive note, Chinese tech firm ByteDance has stepped in, offering to pay at least 630m yuan (US$90.8m) for the new movies to stream them over its various video platforms, South China Morning Post reported.
And other leading Chinese tech brands are also doing what they can to help, with Taobao, Suning and JD.com all pledging last week to prevent price rises for medical items such as face masks and disinfectant.
Alibaba, the Chinese e-commerce giant, also promised to subsidise face masks and other related items, while its Alibaba Health subsidiary said it would offer non-stop delivery services during the New Year holiday.
South China Morning Post further reported that Maoyan Entertainment, China’s largest movie ticketing app, is offering unconditional refunds for screenings in Wuhan until February 8, while Alibaba-owned Taopiaopiao is doing the same until January 31.
Elsewhere, ride-hailing firm Hello Transtech has said that both drivers and passengers will be able to cancel rides going in or out of Wuhan without charge, while online food delivery firms have been equipping their staff with protective clothing.
Sourced from CNN, BBC, South China Morning Post; additional content by WARC staff