The war in Ukraine had a great impact on the global automobile industry


The war in Ukraine is slowly changing everything around us, and it has had a chain reaction in the auto industry.

In fact, most of the key players in the auto industry have acted decisively or have been severely affected by the Russian invasion.

After the sanctions were imposed, most carmakers suspended car exports to Russia and froze overall business activities.

Among them, Volvo, Volkswagen, BMW and Toyota have also stopped production at Russian plants, either to comply with sanctions (as was the case with the first three OEMs) or because of supply chain disruptions (such as Toyota).

It is worth noting that the shortage of spare parts and supply problems have expanded the suspension of production outside Russia. These include:

Production at Volkswagen’s main Wolfsburg plant and several other German plants is slowing, BMW’s factories in Germany, Austria and the UK are facing production problems, Porsche will stop production at its Leipzig plant.

Shortage of spare parts and disruption of supply.
The crisis in Ukraine has made the global supply chain already strained by the epidemic even worse.

In addition to the shortage of semiconductors, carmakers are now facing shortages of other key components, such as wire harness, neon gas and palladium.

Ukraine is one of the major wire harness suppliers in Europe, accounting for 1/5 of the total supply. This component is necessary for automotive electronic components and a basic step in the assembly process-the Ukrainian factory where it was manufactured has now been closed as a result of the invasion.

The United States will be hit hardest by neon gas shortages. Almost all of Ukraine’s neon supply comes from Ukraine and Russia, according to Techcet, a market research firm that specializes in key supply chain materials and components. Neon lamp supply is mainly used for chip production.

The company also estimates that Russia supplies about 33 per cent of global demand for palladium, the metal needed for semiconductor chips.

Post time: Apr-08-2022