Russia-Ukraine War Crisis Affecting Auto Industry; Should India Worry?

Currently, the Russia-Ukraine war is making things worse and taking precious lives. Along with other areas, the automotive industry is also facing bad times since it has been affecting the supply of semiconductor chips which are an integral part of vehicle manufacturing. The whole world’s auto industry is going through tough times due to the scarcity of semiconductor chips and now the war between two major exporters of raw material for several types of microchips will make the situation even more adverse. 

Russia's military action, as well as the resulting trade sanctions, have forced many automakers to halt production and shipments to Russia. Here is how the automotive industry has responded to the conflict. Hyundai will halt production at its St. Petersburg plant until March 5, 2022. Similarly, Mitsubishi has stated that it may halt production and sales of its vehicles in Russia, while Volvo and General Motors have also halted shipments to Russia until further notice.

Volkswagen has also announced that cars will not be delivered to its Russian dealers until further notice. Furthermore, due to the war, the German automaker has stated that it expects to halt production at several of its plants, including one in Wolfsburg, until March 14th. Volkswagen halted production at its Zwickau and Dresden factories, where it manufactures electric vehicles, last week due to a delay in receiving parts from Ukraine.

Owing to part shortages, its group company Skoda has reduced production of the Enyaq iV electric crossover in the Czech Republic. Its two Russian plants are still operational. Other Volkswagen Group vehicles that use the MEB platform, such as the Enyaq iV, are also affected. However, the manufacturing plants in European countries are affected so far, we shouldn’t think that the Indian automobile industry is safe, the situation is not good for our country as well.

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