Chip crisis crimps German, UK car sales but electric up

Automotive Industry

Source:, 2021-10-05

New car sales in Germany and Britain sank in September as a global chip shortage bedevils the auto sector, but electric demand accelerated in both countries, data showed on 5 October.

After a strong recovery at the beginning of the year, a worldwide shortage in semiconductors- key components in both electric and conventional vehicles has hamstrung automakers.

In Germany, Europe's top economy, 196,972 new cars were registered in in September, 26%fewer than in the same month in 2020, according to the KBA Federal Transport Authority. The sector was set to "stagnate or even go backwards" this year despite the "low, coronavirus-hit" sales figures for 2020, the President of the VDIK car importers' federation Reinhard Zirpel said.

Since the beginning of the year, 2,017,561 cars have been sold in Germany, lagging behind the figure for the same period last year by 1.2%.

Major German parts manufacturer Continental said it expected the semiconductor shortage to continue into 2022.

"Many market observers assume that only beginning in 2023, when capacity at chipmakers has increased, will there be a clear improvement in the situation," Continental CEO Nikolai Setzer told German news agency DPA.

This week, carmaker Opel closed its plant in the eastern city of Eisenach until the start of 2022 due largely to the shortfall in chips.

Production at the central Volkswagen plant in Wolfsburg has also been halted for almost two weeks as Germany's biggest carmaker adjusts to limits in supply.

In contrast to the general trend, electric vehicles saw significant growth, with 58.8%more sold in September than in the same month in 2020.

In the UK, new registrations for all cars dived almost 35% in September on a yearly basis to 215,312 vehicles, the Society of Motor Manufacturers and Traders said in a statement.

That was the lowest September level since 1998, and comes after sales were already hit hard last year by pandemic lockdowns.

"This is a desperately disappointing September and further evidence of the ongoing impact of the Covid pandemic on the sector," noted SMMT Chief Executive Mike Hawes.

"Despite strong demand for new vehicles over the summer, three successive months have been hit by stalled supply due to reduced semiconductor availability, especially from Asia."

But like in Germany, new electric vehicle registrations soared, rising almost 50%to hit 32,721.

Analysts expect Britain's electric car demand to surge further in the coming months in the face of recent shortages of motor fuel.

"Recent motor fuel shortages will give people who are considering trading up to a new vehicle more reason to consider an electric vehicle," Pantheon Macro economist Samuel Tombs told AFP.

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