I

Inflation and supply chain problems continue to affect automakers, with Toyota and Tesla both sounding the alarm.

Japan’s Toyota warned today that “increasing raw material prices” will hurt its bottom line, while Tesla CEO Elon Musk hinted that his company may stop accepting orders. new order.

Toyota forecasts a 21% drop in profit this year due to “unprecedented rise in material and logistics costs”.

Separately, Musk said at a conference that supply chain problems could cause Tesla to stop taking new orders.

“The frustration we’re seeing from customers is not being able to buy them a car,” he said at an FT event.

“We might actually stop taking orders after a certain amount of time because some time it’s a year away.”

Many of the world’s largest automakers were recently forced to close their Chinese production facilities after the Covid shutdown, leading to parts shortages and increased vehicle delivery times. This week, Tesla warned of disruption to its largest factory in Shanghai.

The problem was exacerbated by the sharp increase in the price of raw materials such as Nickel, which is vital to the production of car batteries. Nickel prices are up 45% since the start of the year, amid trade restrictions with Russia, the world’s third-largest producer of the metal.

A global semiconductor shortage, fueled by shutdowns at the start of the pandemic, is also weighing on the industry.

British car dealership Vertu today warned that “new car supply” will be a key determinant of its performance this year.

Vertu noted caution even as the company posted record profits for the year just ended. The company reported a profit of just around £2 billion in the year to February 2022, despite a 15 per cent drop in car sales.

“Consumers are increasingly accepting longer usage times,” the company said.

LEAVE A REPLY

Please enter your comment!
Please enter your name here