LDN - Business

Michigan due to reopen manufacturing from coronavirus lockdown

[May 11, 2020] By Ben Klayman

DETROIT (Reuters) - Michigan was due to allow its factories to resume production on Monday after more than six weeks of a coronavirus lockdown, removing a major obstacle to North American automakers seeking to bring thousands of idled employees back to work this month.

Michigan, a major Midwest industrial powerhouse hard hit by both the coronavirus pandemic and its economic fallout, is the latest of several states permitting the restart of assembly lines halted in mandatory business closures meant to contain the outbreak.

But in announcing plans last week to reopen manufacturing, Whitmer, a Democrat, extended a stay-at-home order requiring residents to remain mostly indoors, except for outings like grocery shopping, doctor visits and limited recreation.

Whitmer, seen as a potential running mate for presumed Democratic presidential nominee Joe Biden, was an early target of protests around the country organized by supporters of Republican President Donald Trump demanding to end the lockdown.

Michigan, a crucial electoral swing state narrowly carried by Trump in 2016, has lost more than 4,550 lives to COVID-19, the respiratory illness caused by the novel coronavirus, ranking fourth among the 50 U.S. states in deaths.

In the nation as a whole, nearly 80,000 Americans have died from COVID-19, out of more than 1.34 million known U.S. infections tallied since Jan. 20, according to figures compiled by Reuters.

Whitmer's reluctance to reopen factories in Michigan also had hampered efforts to restart vehicle assembly elsewhere in the United States because key parts suppliers are based in and around Michigan's automaking hub, Detroit.

The clamor for Whitmer to give the go-ahead increased when Republican Governor Mike DeWine in the neighboring state of Ohio, also a key player in the auto industry, announced he was permitting manufacturing to resume there as of last Monday. California followed suit on Friday.

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A woman wearing protective coverings speaks on the phone, amid the outbreak of the coronavirus disease (COVID-19), in Detroit, Michigan, U.S., May 6, 2020. REUTERS/Emily Elconin

The government of Mexico, another important link in North America's automobile production chain, is expected to make an announcement this week regarding its plans for the industry.

The auto sector accounts for 6% of U.S. economic output, with more than 835,000 Americans employed in vehicle production.

Several weeks of widespread business shutdowns as part of unprecedented social distancing measures have dealt a catastrophic blow to the U.S. economy, casting Americans out of work in numbers unseen since the Great Depression of the 1930s.

The U.S. Labor Department reported the nation's unemployment rate climbed to 14.7% last month, up from a record low of 3.5% in February, and shattering the previous post-World War Two high of 10.8% reached in November 1982. Some 33.5 million U.S. workers have filed first-time claims for jobless benefits over the past seven weeks.

While New York state, the U.S. epicenter of the pandemic, has reported a steady decline in hospitalizations and other key measures of the outbreak in recent weeks, many states - especially in the Midwest - are seeing rising case tallies even as they forge ahead to reopen their economies.

Public health experts have warned that moving too quickly to reopen, without vastly expanded diagnostic testing and other precautions firmly in place, risks fueling a resurgence of the virus.

It also remains to be seen how many consumers are willing to venture back into shopping malls and restaurants in the midst of an ongoing pandemic for which there is no vaccine and no cure.

(Reporting by Ben Klayman in Detroit; Writing by Steve Gorman)

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