The global auto industry continues to navigate a challenging supply chain environment as well as lingering COVID-19… https://t.co/Z5fAb0yo7i
Chips still squeezing: YTD 7.4mn units and -10% growth impact
The automotive sector has 'lost' 7.4mn light vehicles this year, i.e. a 10 percentage point negative growth hit even before we factor in losses coming in Q4.
Chip shortage has cost the industry 7.4mn units year-to-date
As we embark on Q4, we estimate the ongoing semiconductor shortage has caused 7.4mn units of lost global light vehicle production during 2021 so far. We currently forecast 2021 global light vehicle sales of 80.8mn units (+8.3% y/y growth), which means the YTD production losses have already hit 2021 volume growth by 10.0 percentage points, excluding those losses yet to be incurred in Q4.
Q4 interruptions bumping along the bottom
The production disruptions have worsened sequentially as 2021 progressed. The lost units in Q3 (3.4mn) were more than double (2.4x) those lost in Q1 (1.4mn), and each of the last three quarters has seen disruptions worsen further. For the tail end of this year, although we expect Q4 to bring a long-awaited easing of the losses (in quarterly sequential terms), Q3 is likely to be a better proxy for disruption levels than Q2.
US OEMs have been hardest hit
Year-to-date, Ford and GM have seen production interruptions equating to 25% and 21% of their 2020 volumes respectively. Premium carmakers (e.g. BMW, Volvo, JLR, Daimler) have by contrast got off relatively lightly (losing between 1% and 7% of prior year volumes. Note however that OEMs' deliberate production allocation decisions towards more profitable models (and therefore positive offsets not captured in this analysis) might create distortive effects.
Toyota capitulation surprised in September
Toyota made a surprise 300k unit cut to its FY21 production guidance in early September, challenging the established view that it had managed its supply chains better than peers. So while many large OEMs (e.g. VW see below) have seen a fairly stable cadence to their disruptions, no OEM is fully immune from being the next to surprise. Our production forecasting team compiled information on over 300 plant-specific outages across 63 carmakers to arrive at the above estimates.
Next production outlook revision due 15th Oct
In our last (16th September) update to our production forecasts, we made pronounced downgrades to our near-term (2021 and 2022) production outlooks (by 6.2% and 9.9% respectively) triggered primarily by a substantial worsening of signals received via our ongoing supply chain channel checks. We continue to hear negative noises. We will provide our next forecast update is due on 15th October.
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