Russia’s invasion of Ukraine reduced monitors Auto industry Production and sales forecasts for the next two years, following the crisis closed factories in Eastern Europe and caused raw material prices to rise sharply.
Some factories in Ukraine tried to survive the invasion, but the workers eventually had to leave work to escape the missiles.
For its part, S&P Global Mobility, formerly known as IHS Markit, cut its forecast for global auto production by 2.6 million vehicles in both 2022 and 2023 due to the war, while its worst-case scenario estimates were up to 4 million vehicles lost.
It estimated that European car production would decrease by regarding 9% – nearly one million cars, according to CNBC, which was seen by Al Arabiya.net.
Some of that is directly due to the loss of car sales in Russia and Ukraine, but these two countries together make up a small share of the global car market – regarding 2% of the total in 2021.
The biggest concern is the shortage of materials and parts that are already hitting European car manufacturers, as the report warned of the possibility of the crisis expanding to other markets if the war continues.
Separately, the credit rating agency S&P Global Ratings also forecast that global auto sales in 2022 will drop by 2% below 2021 levels. This is a significant departure from the previous forecast of a 4%-6% increase in sales for 2022 that the group had forecast in last October.
The report highlighted disruptions in the supply chains of critical auto parts from the region, perhaps most notably wires from Ukraine, and also vulnerable raw materials – Russia produces regarding 40% of the world’s crude palladium – which is used to clean car exhaust.
The two countries are also among the largest producers of nickel, which is used in electric car batteries, in addition to the indirect impact on metals common in the industry, such as iron, whose prices have also risen globally.
