Semiconductor shortage hits the market harder than COVID

Semiconductor shortage hits the market harder than COVID

FineAuto

New car sales in the UK set an anti-record in July. According to Reuters, citing the British Society of Automotive Manufacturers and Traders (SMMT), the market has shrunk by almost 30 percent on an annualized basis, the worst result since 1998. Even in the conditions of the coronavirus, car sales did not collapse so much.

Last month, the British purchased only 123.3 thousand new cars, which is 22 percent less than the average for the last 10 years. Experts blame the pandemic for this.

While July 2020 will be remembered for a jump in sales, as it was the first month after the lockdown, in July this year the industry faced problems again. We are talking about a global shortage of electronic components caused by last year’s production cuts. The shortage of chips became known back in the winter, but by the summer it only worsened and is already leading to a drop in sales.

But one more problem was added to this. Due to the harsh antiquity measures in July, many employees of car factories in the United Kingdom were forced to self-isolate due to suspicions of contact with those infected. This led to an acute shortage of workers at the enterprises. Last week, 69,097 cars were assembled in the country, which was the lowest result in 68 years.

Considering the July figures, SMMT has revised its 2021 UK sales forecast for the worse, with 1.82 million vehicles expected to be sold instead of 1.86 million. Experts hope that the easing of restrictions, which many Brits complain about, could slightly improve the situation.

A decline in sales was also recorded in other key European markets, and the reasons are the same – a shortage of microchips. Let’s remind that in Ukraine July turned out to be not very bad for the car market. In July 2021, through the efforts of all operators, it was possible to sell 9.8 thousand units of new passenger cars, which is 10% more than last year. However, July sales have traditionally become their peak since the beginning of the year and in fact the Ukrainian car market has set a post-crisis sales record. We haven’t sold that many since February 2014.

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