PARIS/TOKYO -- Forget about clinging to hopes that China, the world's largest car market, will recover from its unprecedented two-year slump anytime soon.



Though concrete estimates on the financial toll of the coronavirus outbreak are still scarce, signs are emerging that the final cost will far outweigh that of the 2003 SARS epidemic, when China's auto market was one-sixth the size it is today and smaller than that of Japan.

Companies from Tesla to Volkswagen Group and Toyota have warned they anticipate disruptions, while a supplier predicted automakers will cut China production 15 percent this quarter.



China's car sales were already heading for the lowest in at least five years before the current outbreak forced authorities to lock down the epicenter of Wuhan city and beyond. Now, it's unclear when consumers will come back to showrooms as 14 provinces and cities that accounted for almost 70 percent of the country's gross domestic product shut businesses and factories until at least the second week of February.



"The risks are enormous because of the sheer weight of China in the global market and its importance to trade," said Jean-Louis Sempe, a Paris-based analyst at Invest Securities. "Predicting the seriousness of the epidemic is very difficult, but there's no doubt the impact could be huge on factories, supply chains and domestic car sales."



Should passenger-vehicle sales in China fall 20 percent from last year's 21.4 million units, that would threaten to end the country's run as the world's largest auto market, a rank it's held for more than a decade.

China's motor city



General Motors and Honda are among the automakers with factories in the Wuhan region, while state-owned Dongfeng Motor is headquartered in the city of about 11 million people.



Nissan and PSA Group also have assembly plants in Wuhan or the broader Hubei province and are partners with Dongfeng.

Robin Zhu, an analyst at Sanford C. Bernstein & Co., singled out Dongfeng/PSA as "by far the most exposed" because of the high proportion of vehicles it makes in the area.



"Investors will need to brace for a slowdown in broader activity levels in China," Zhu said in a Jan. 27 note. "We expect the Chinese auto industry to endure a traumatic next few months."



Automakers probably will dial back production by 15 percent in China this quarter after extending holiday shutdowns because of the virus, supplier Aptiv said Thursday. Aptiv, whose customers include GM and Volkswagen, expects its own production to be down 11 percent from a year ago.



The government extended the annual Lunar New Year holiday break -- with its workplace closures -- by several days to curb potential exposure. Tesla was among the companies saying they are monitoring potential supply-chain interruptions for cars built outside China, as well.



"This will be horrendous in the supply chain, it's going to be awful for companies and it will show in their quarterly reports and global strategy going forward," said Rosemary Coates, a supply chain consultant and executive director of the Reshoring Institute, a non-profit focused on expanding manufacturing in the U.S. "It's going to show and it's going to hurt."



The epidemic comes at a delicate time for the car industry, which faces sales slumps also beyond China, and pressure to make heavy investments in electric and self-driving cars.

Compounding the danger for automakers is the overall economic slowdown, with the virus potentially shaving more than 1 percentage point off first-quarter growth in China's gross domestic product.



China also is the world's biggest market for electric vehicles. The demand for EVs and traditional premium models will suffer the most because sales of those vehicles are concentrated in the biggest cities, which happen to be the ones most affected by the epidemic, Zhu said.



The effect is felt far beyond the Wuhan region. Tesla expects a potential 10-day delay in production ramp-up at its new Shanghai plant -- its first outside the U.S. -- because of the government-required shutdown. Chief Financial Officer Zach Kirkhorn said Jan. 29 the delay may also "slightly impact" the company's profitability this quarter.