Admittedly, right here on the Dashboard we’ve got been publishing quite a bit in regards to the torrent of points dealing with the Automotive Business. Gross sales in China are down. Provide chains proceed to be a common mess of delays. Vegetation proceed to run at decreased capability (at greatest it appears). And on and on.
The trade information has not gotten higher. The latest studies are actually predicting that the chip scarcity will final into 2023. In fact, take into account, that as electrification will increase, the necessity for chips will increase. Revenues are down everywhere in the trade. GM third quarter revenue was down 41% from the prior yr. Volkswagen was down as nicely. Stellantis too: income down 14%. With out stock, with gross sales down, with consumers left with nothing to purchase, not solely are the OEMs down, however their suppliers are after all down as nicely (it will be onerous to not be).
The shortage of automobiles has an unsurprising impression on used automobile gross sales: they’re equally harassed by lack of stock. If folks can’t purchase new automobiles, they can’t commerce in outdated automobiles. And, they could very nicely be shopping for used as a substitute of latest due to what may be accessible. Previously 18 months, used automobile costs are up 40%. The costs proceed to go up. One forecast doesn’t see the used automobile market normalizing till “nicely into 2022”.
In different information, the transfer to electrification marches alongside. However for the present work power, that’s troubling information (as it’s in loads of transitioning industries). Electrical automobiles have fewer shifting components and are, arguably, less complicated to assemble, requiring fewer employees. One report has job losses already above 70,000, only for OEMs. Add in suppliers at each tier and one can simply compute some very giant numbers of job reductions. Whereas this can arguably assist the trade scale back prices and improve earnings, it would depart scores of individuals across the globe with out work.
There are, after all, new jobs as nicely. However they require new and completely different abilities that aren’t essentially simply obtained. In Alabama alone, there are at present 1000’s of open jobs within the automotive trade which are ready to be stuffed. That is in keeping with different industries as employees proceed to choose and select among the many myriad of positions accessible.
Let’s add to those challenges: who is prepared for an aluminum scarcity? A number of studies are actually saying that magnesium goes to be onerous to supply in 2022. On the very least, this can trigger materials costs to extend. Such will increase routinely have a cascading impression on costs all the way in which to the showroom.
Any approach one appears to be like at it, the automotive trade, like loads of industries, continues to face difficult instances amid a altering panorama across the globe.