View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. News
March 4, 2022updated 07 Mar 2022 5:25pm

Supply chain impacts of Ukraine crisis on the rise

Automotive supply chains in Europe are increasingly being disrupted by the effects of the crisis in Ukraine.

By David Leggett

Russia’s largest vehicle maker, AvtoVAZ, maker of Lada branded cars, is planning to suspend production at its Russian plants next week.

Media reports say it will stop its Togliatti and Izhevsk plants on Saturday and from March 9 to 11. The company is reportedly struggling with shortages of electronic components.

Shortages of components and supply chain disruption are also hitting automotive companies more widely in Europe reflecting the industry’s long, complex and interconnected supply chains.

Analysts say supply chain specialists in Europe’s auto industry will be busy assessing the robustness of existing parts supply lines, possible sourcing alternatives and also prioritising product lines for fitment.

BMW has said this week that it expects temporary shutdowns because of parts shortages, and announced it will suspend vehicle exports as well as local assembly in Russia because of the invasion.

German wiring harness maker Leoni, with two manufacturing plants in Ukraine employing some 7,000 workers, said it is intensifying efforts to help offset the disruption in Ukraine by adding capacity at other sites.

“Logistics in and out of Ukraine are a particular challenge, especially because of the partly chaotic situation at the border points with the EU,” Leoni said in a statement.

The Volkswagen Group said in a statement that it ‘has received the news about the war in Ukraine with great dismay and shock. Volkswagen continues to hope for a cessation of hostilities and a return to diplomacy. We are convinced that a sustainable solution to the conflict can only be found on the basis of international law.’

VW Group has now decided to stop the production of vehicles in Russia until further notice – impacting its sites in Kaluga and Nizhny Novgorod. It has also said that vehicle exports to Russia will also be stopped with immediate effect.

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Monday. The industry's most comprehensive news and information delivered every quarter.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Just Auto