Chip crisis shatters industry hopes of a sales recovery after pandemic

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Hopes that 2021 would recoup much of the auto sales lost to the pandemic in 2020 are fading as the semiconductor shortage continues to lead to widespread plant shutdowns.

Last month, IHS Markit, which many automakers use as a benchmark for production forecasts, said it was prune your production forecasts from 6.2%, or 5 million units, to 75.8 million for 2021.

“The outlook for the fourth quarter now reflects increased risk as supply chain challenges – primarily semiconductors – remain entrenched,” wrote IHS analyst Mark Fulthorpe.

In its latest investor note, IHS said 9.5-11 million units could be lost over the whole year. Contrary to earlier statements from automakers and analysts predicting a recovery in the second half of 2021, IHS said on Monday that the disruption could continue into the first half of 2022.

“The second half of 2022 could be the point at which we seek stabilization of supply, with recovery efforts not now starting until the first half of 2023,” the note said. “We are extending the window of potential disruption and further delaying the point at which we believe a meaningful recovery can begin.

IHS estimates that around 1.1 million units were lost in the first half of the year. Third quarter loss estimates were increased to 729,000 units from 666,000 units, mainly due to production stoppages at Stellantis and Volkswagen.

That figure does not include up to 50,000 “incomplete” vehicles produced at VW that lack critical parts that must be added before they can be sold, IHS said.

On the demand side, LMC Automotive said in late September that it was reducing its global light-duty vehicle forecast from 6 million units to 81 million vehicles. In June, LMC had forecast demand of 87 million vehicles for the year.

“Hopes of a return to pre-pandemic conditions and a full recovery in early 2022 have all but evaporated,” the analyst said.

LMC also noted that future demand for vehicles could suffer from current conditions, in which automakers have favored higher margin models and emission-compliant (and expensive) electric vehicles, resulting in higher prices and a shortage of fuel. low-end vehicles in showrooms.

“Lack of vehicle availability and rising prices may have pushed a number of consumers in many countries out of the new vehicle market,” LMC said, “forcing them to either keep an existing vehicle for longer or to buy a used vehicle, or buy a lease, instead of buying / leasing a new vehicle.

LMC now forecasts global light vehicle sales of 85 million units in 2022, down 8% from its second quarter forecast, and 94 million units in 2023, down 3% from second trimester.


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