Volkswagen sees better chip supplies in second half boosting output
Volkswagen AG
expects the protracted shortage of semiconductors to ease during the second
half of the year and contribute to a surge in output, offsetting months of
curtailments.
VW confirmed a projection that deliveries will rise by as much as
10% this year, it said Wednesday, even after production slumped by 12% during
the first three months. Strong prices and demand for high-end premium cars
helped to offset lower production, it said.
“The overall situation of the world -- with Covid in China, the
war in the Ukraine, semiconductors still in short supply -- this is quite a
challenging environment,” Chief Executive Officer Herbert Diess said in an
interview with Bloomberg TV. “I’m happy we could show resilience in the first
quarter.”
The company warned its upbeat forecast hinged on further
developments from the war in Ukraine and China’s strict coronavirus policies
weighing on the global economy. The company has managed to navigate the
shortages of chips and wire harnesses from suppliers in Ukraine by reallocating
resources between its main markets in Europe, China and North and South
America, it said.
The shares were almost unchanged in Frankfurt trading and have
declined 16% since the start of the year.
So far, carmakers like Mercedes-Benz AG and BMW AG have come through
the supply-chain crisis by raising sticker prices for new and used vehicles to
offset the drop in production. Still, while demand remains strong, record price
swings in commodity markets and the ongoing war in Ukraine are clouding the
outlook.
While Volkswagen has halted
its operations in Russia, it also had to temporarily shut some sites in Europe
after suppliers of wire harnesses in Ukraine were unable to deliver components.
As Europe weighs reducing its dependence on Russia for oil and natural gas,
Diess acknowledged that Volkswagen was
concerned with threats to the energy supply at its factories.
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