Wells Fargo auto analysts see the potential for Europe to make up for lost production this year.

　　According to foreign media reports, the escalation of the situation in Russia and Ukraine may cost European automakers the production of hundreds of thousands of vehicles. Ukraine is a key producer of automotive wiring harnesses, and analysts predict that supply issues could cost Europe 10% to 15% of vehicle production this year.

　　Wells Fargo automotive analyst Colin Langan said in a report that the shutdown of the Ukrainian wiring harness plant could cost Europe as much as 700,000 lost production in the first and second quarters. Volkswagen Group and BMW Group have already suspended production at some European plants due to supply disruptions, and Mercedes-Benz Group has also cut production at a German plant.

　　According to Langan, Ukraine is a key production location for automotive wiring harnesses. There are 17 wiring harness production facilities there, and it is cheaper for companies to operate factories locally. He also sees the potential for Europe to make up for lost production this year.

　　Image source: LEONI

　　Before the escalation in Russia and Ukraine, German auto parts supplier Leoni produced wiring harnesses at two factories in western Ukraine and employed about 7,000 people. On March 14, Leoni lowered its 2022 sales and profit forecasts, saying the company would not be able to make up for lost production this year. While Leoni plans to double output at some of its factories in other regions, it may take at least two to three months to adjust.

　　The impact of wiring harness supply shortages on car companies is not limited to car production. On March 15, Volkswagen Group CEO Herbert Diess said that if Volkswagen cannot restart production within three to four weeks, it may need to readjust its 2022 performance forecast. VW has forwarded semiconductor products for 50,000 to 100,000 vehicles to assembly plants in China and the United States due to disruptions in the European supply chain.

　　This article is reproduced from Gasgoo