Volkswagen’s top brands flag chip risk in months ahead
8:26 am Friday, July 30th, 2021
FRANKFURT (Reuters) – Volkswagen’s top three brands on Friday pointed to an ongoing shortage of automotive chips that could intensify in the coming months, highlighting the industry’s difficulty in tackling the issue.
“Although there are signs that the supply bottlenecks for semiconductors are beginning to ease, we expect a very challenging third quarter from a supply perspective,” Alexander Seitz, chief financial officer of VW’s namesake brand, said.
Volkswagen had said on Thursday that lost production due to the crisis, which started to hit the automotive industry at the end of 2020, currently stood at a high six digit number of vehicles.
Volkswagen still managed to crank out record profits for the first half of 2021, favouring high-margin Porsches and Audis in its allocation of chips, a key component in modern vehicles.
“In spite of all this success, we are well advised to keep both feet on the ground,” Porsche CFO Lutz Meschke said. “Because regardless of the uncertainties of the coronavirus pandemic, the continuing tense situation on the semiconductor market could become noticeable in the third quarter.”
Volkswagen, which has been hit by the bottleneck along with rivals Daimler, BMW, GM and Ford, on Thursday said it had managed the situation quite well, but also highlighted “some impact” in the third quarter to September.
Audi, Volkswagen’s biggest profit contributor, on Friday said there were signs that the months ahead would be marked by a critical supply situation.
“Audi continues to work intensely on counter-measures, but in view of the continuing shortage it is not expected to be possible to compensate in full in the course of the year for lost production,” it said.
(Reporting by Christoph Steitz. Editing by Jane Merriman)
