The global chip shortage is continuing to wreak havoc on the automotive sector, with several of the world’s biggest carmakers blaming the crisis for disappointing financial results this week.
Volkswagen and Stellantis said Thursday that the ongoing semiconductor shortage remains a major problem for them.
“It was a challenging quarter,” VW CEO Herbert Diess told CNBC on Thursday.
“Our volume brands suffered most because of semiconductor supply,” Diess said, referring to Seat, Skoda and Volkswagen.
In comparison, Porsche and Audi (Volkswagen’s premium brands) have been “quite resilient,” Diess said, adding that they’ve delivered positive results.
With no end in sight, the semiconductor chip shortage is now expected to cost the global automotive industry $210 billion in revenue in 2021, according to consulting firm AlixPartners.
From a geographic perspective, Diess confirmed that VW’s China business has been disproportionately affected.
“China really suffered,” he said, adding that VW lost market share in the country.
But Diess claimed that it’s not all negative. “The demand side is really good,” he said. “We have filled order books in all areas and our EV [electric vehicle] sales are coming along well.”
Diess is optimistic that semiconductor supply will pick up in the next quarter, but he still expects to see some supply constraints in 2022.
“We foresee that semiconductors will be bottlenecks in our supply chain,” he said. “There might be others as well, but mostly we will see semiconductor constraints.”
Elsewhere, Stellantis — formed through the merger of Fiat Chrysler and France’s PSA — has also been hurt by the chip shortage.
Like VW, it also missed analyst expectations when it reported its third-quarter results Thursday. Stellantis reported a 14 percent fall in third-quarter revenue after semiconductor shortages cut planned quarterly production by 30 percent, or 600,000 vehicles.
“The level of chip shortage was probably slightly higher than what we had expected when we last spoke to the market in August,” Chief Financial Officer Richard Palmer said, adding that the full-year total of lost production due to the chip shortage would top a previous forecast of 1.4 million units.
But Palmer said the business has seen a “moderate” improvement on the chip supply situation this month compared to September. He expects the trend to continue through the fourth quarter.
“Visibility on semiconductors continues to be a difficult subject for the industry,” Palmer added.
U.S. carmakers GM and Ford managed to beat analyst expectations despite the chip shortage.
Ford surprised industry watchers Wednesday when it shattered Wall Street’s earnings expectations for the third quarter and it said it has already benefited from improved supply of chips.
Meanwhile, GM CEO Mary Barra said during a call Wednesday that the automaker’s supply of semiconductor chips is improving, but “it still continues to be somewhat volatile.” She said GM expects the shortage to continue into the first half of next year.