COMPANIES & STRATEGIES - INDUSTRY

Automobiles

Car industry expects more delays



Clients might not see their new cars arrive before 2022, warns the HOA.  Photo: Shutterstock

Clients might not see their new cars arrive before 2022, warns the HOA.  Photo: Shutterstock

The Luxembourg House of Automobiles (HOA) on Wednesday 20 October announced in an official statement that the delivery of new cars will be postponed. The automobile industry has been struggling with various shortages since the beginning of the year.

Situation likely to continue in 2022

Car dealerships in Luxembourg are struggling to fulfil orders and are forced to prolong the delivery dates of new cars by months, without knowing if they can respect those new dates either.

The HOA--which promotes the automotive sector and its players--lists several factors for its suffering. The pandemic, which made essential building components unattainable, is amongst the culprits. The lockdown also decreased the demand for new cars in 2020, so that manufacture was refocused on electronics. A large fire in a semiconductor chip factory in Japan also caused a worldwide shortage of this essential car part.

And though suppliers work together with local dealerships, “the situation changes on a daily basis, so it is hard to commit to new dates,” said the HOA in its statement.

One of the bigger issues concerning the worldwide chip shortage is the manufacture of the item, as a particular environment has to be built to create the chips. In addition, when the demand for chips rebounded at the end of 2020, suppliers were unable to meet the higher demand as their stocks were empty and production wasn’t as fast, says an article by the BBC.

In Luxembourg, where car sales fell by 13.24% over 2020, this news comes as another hit to the automobile industry. Added to this is the surge in fuel prices--currently at €1.565/L.