COMMENT: Automakers hold their breath as Egypt stutters

By Simon Warburton | 2 February 2011

Anyone who thought this week's attempt by protesters in Egypt to impose their will on a regime, whose President has been in power for 30 years, was going to be plain sailing, are having to think again.

The turmoil currently engulfing the country and centering obviously on the seat of power in Cairo - has seen automakers hastily re-evaluate their manufacturing plans for the time being at least.

Most telephone lines to the country are down making outside evaluation of the situation fluid at best, as carmakers hold daily meetings to see if their employees can safely return to work.

There has been substantial talk of the Middle East replicating the domino effect of former communist regimes in Eastern Europe that one by one, succumbed to wave after wave of popular and - largely - peaceful revolution.

But Egypt appears to be enjoying no such harmonious transition as initial euphoria has given way to increasingly confrontational scenes in Cairo's Tahrir Square.

After several days of anti-Hosni Mubarak demonstrations, it is now becoming clear the President's men are gathering and in extraordinary scenes today in Cairo, both sides faced each other head on in a manner more reminiscent of medieval armies squaring up before attacking.

Graphic illustration of how this is affecting automakers came in a call today (2 February ) by just-auto to a source in Cairo familiar with the car industry in Egypt and who outlined how difficult it was to bus workers into vehicle plants.

"No-one can predict what will happen," said adding: "There is a very short window for the curfew - it starts at 15:00 and ends at 08:00. It is until further notice - everybody has stopped working."

Calls to the Egyptian Automobile Manufacturers Association in Cairo went unanswered, as did several others to automakers based near the Egyptian capital as the population continues to watch and wait in the unfolding confrontation.

The source revealed GM's board was convening daily to asses the situation, while Daimler and Nissan are also thought to have stopped operations temporarily.

Quite when production can start again is anyone's guess, particularly as the situation has taken a dramatic new turn today.

As the Egyptian source put it to just-auto: "Only the food factories [such as] canned milk are producing - we don't want our people to be hungry. Cars are considered to be accessories."