The pandemic put an end to surplus car production after at least three decades. Shortages in semiconductors, disruptions in supply chains and rising raw material costs have led to production delays, resulting in months of delays in delivering new vehicles to consumers. "The market will return fully in 2023," said automotive industry expert Ferdinand Dudehefer of the Duisburg Center for Automotive Research (CAR) in a recent report.
While in 2019 3,6 million cars were sold in Germany, in 2020, the first years of the pandemic, 2,9 million were sold. The CAR research center puts sales at just 2,69 million this year. Ferdinand Dudehefer predicts improvement in 2022 with sales of over 3 million cars. However, he estimates that in the first half of 2022 the German car industry will be faced with shortages of microchips, while at the same time no one is able to rule out new pandemic waves from new mutations in the coronavirus. At the same time, the German expert points out that the average ownership of a car is on the rise in Germany and now exceeds a decade. Consequently, there is another reason for consumers, apart from electricity, of course, to buy a new car.
Record profits despite the crisis
After the difficult 2020, the first half of 2021 brought a cessation of car production in Germany. At the same time, however, markets such as those in the USA, Russia and Brazil found themselves on an upward trajectory during this period. "For the first time in 2021, more cars were sold in India than in Germany," says the German expert. The same will apply in 2022 with India marginally "stealing" the lead from Germany.
In 2019, the year before the pandemic, about 80 million new cars were sold on the world market. In 2020 their number decreased by about 14%, reaching only 68,6 million cars. According to the CAR center, 2021 million will be sold in 70,5, while 2022 million cars are expected to be sold in 75,2. Even in 2023, however, sales will not reach pre-crisis levels. The return to 2019 level sales is projected for 2025.
Despite the crisis for the automotive industry, there was positive news in 2021. According to an analysis by EY, the operating profits of the 16 largest automakers in the world reached 23 billion euros in the third quarter of this year, an increase of 11%, breaking a new record.
Bad omens in view of an increase in cases and restrictive measures
Although car sales fell 16% (analysts estimate that 11 million cars were not built due to shortages alone) 13 manufacturers sold fewer vehicles than last year and the 16 largest automakers had slightly lower turnover , reaching 371 billion euros. Leading manufacturers increased their profits by placing the few microchips in more expensive models that yielded more profits. Besides, the car manufacturers did not have to make discounts since the demand for new vehicles far exceeded the supply. At the same time, most major manufacturers in 2021 managed to increase their market value with the first and best American Tesla.
However, EY is convinced that the alleys will continue to plague the automotive industry worldwide. In an analysis, it states that "outbreaks in some countries and stricter restrictive measures may cause new problems in production and supply chains." The car crisis is hitting China hard. In the largest car market in the world, sales fell in the third quarter of 2021 by 26%.
Source: Deutsche Welle