- After nearly two years of supply chain problems, Russia’s invasion of Ukraine is causing more problems for automakers in Europe in addition to the horrific human victims of the invasion.
- Ukraine, it turns out, supplies a lot of wiring harnesses, and is now launching into the European market VW ID.5 EV (pictured above) is delayed due deficit.
- Renault, which controls Russia’s largest carmaker, suspended operations in the country this week, again raising questions about whether the Russian government will simply take control of the plants and other assets from which Western automakers are leaving.
Russia’s invasion of Ukraine continues to severely disrupt life outside the active areas of hostilities. In the automotive world, European automakers have been forced to cut production or even postpone the release of new models because, as we have all learned well over the last two years, supply chains are not a given.
When the invasion began, it suddenly became important that Ukraine supplies a large number of wiring harnesses to European automakers. This week Volkswagen said it would postpone the launch of ID.5 for a month because it could not get enough harnesses to send demonstration cars to dealers in Germany. ID.5 is a version of the SUV “coupe”. ID.4 and was to be launched in Europe in April. Now the launch is scheduled for the first week of May, a VW spokesman said Automotive news. That’s when you can buy enough wiring harnesses.
Automakers that have partnerships or assets in Russia have also been hit hard, most notably Renault. AvtoVAZ is the largest automaker in Russia, but is controlled by French automaker Renault, which owns 69 percent of the shares. This week, after much pressure from outside, Renault decided to suspend its operations in Russia, saying on Twitter that “it is responsible for our 45,000 employees in the country” and that the company “has already taken the necessary measures to meet international requirements.” sanctions ”before the suspension.
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Renault’s suspension is the latest and biggest blow to Russia’s domestic car market, which is now facing potentially significant changes if sanctions imposed by Western and Western countries continue (as they are likely to do, given the fact that Russia do not seem interested in stopping the murder). This was reported by Reuters that AvtoVAZ said Thursday that it will continue to build vehicles, but an authorized supply chain means it will be difficult. “We are actively working to replace some critical imported components with alternative solutions,” AvtoVAZ said in a statement quoted by Reuters. “The company is also preparing special versions of some Lada models with reduced exposure to imported components. They will be available to our customers in the coming months. ”
Lada was forced to stop car production earlier this month, a big step for the brand, which sold 21 percent of all new cars in Russia in 2021. Since Renault has taken at least the first step towards leaving the company, this raises a bigger question. what will happen next. President Vladimir Putin considers nationalization of plants and other assets of global automakers in Russia Automotive news and others reported. Apart from Renault, Volkswagen, Stellantis, Ford and Mercedes-Benz will be the most affected by any step towards the nationalization of assets, which Russian government officials sometimes call the “external administration”.
“If foreign owners unjustifiably close the company, then in such cases the government proposes to introduce external management,” Russian Prime Minister Mikhail Mishustin told CNN earlier this month. “Depending on the decision of the owner, this will determine the future of the company.”
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