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Chennai flood may hit car sales, exports

The unprecedented flood in the Tamil Nadu state capital Chennai is likely to hit local sales and exports of global automakers and component manufacturers as their units remain closed till at least this weekend, agency reports said. Heavy rains over the past week in the city characterised as India's Detroit have claimed more than 270 lives and cut off more than three million citizens from basic services. Many localities, including the airport, remain under water. Carmakers such as Renault, Nissan, and Hyundai as well as tyre manufacturer Apollo will decide on Saturday whether to resume production. BMW will keep its plant closed until Monday. All four carmakers have production facilities only in Chennai. "The impact on the whole ecosystem -- car manufacturers and component makers -- will be really significant," said Abdul Majeed, automotive head at consultant PwC, adding that for those that export more than they sell in India it could be worse. India is increasingly becoming an export hub with carmakers shipping vehicles to countries in Africa, Latin America, and even parts of Europe. In the year ended March 2015, Indian exports of cars, trucks, buses and two-wheelers rose 15 per cent to about 3.6 million, according to industry data.