Brazil's automobile manufacturers reduce production due to Covid-19 & shortage of chips
Due to the impact of the Covid-19 and the global chip shortage exceeding estimates, many automobile manufacturers in Brazil have recently reduced production to cope with this dilemma.
According to the sources, the automotive industry accounts for about 22% of Brazil's steel consumption. Since the beginning of this year, the price of automotive steel products has risen by an average of 40%. Steel mills are expected to adjust prices for automakers by 60~70% starting in April.
In response to the worse situation of the epidemic in Brazil, many car plants such as Hyundai Motor, Volkswagen, Volvo, or Scania have decided to suspend the production to avoid further expansion of the pandemic. On average, it will not fully resume normal operations until April 5 at the earliest.
There is no doubt that the shortage of automotive chips will reduce the production of automobiles, which will lead to a decrease in the revenue of the global automotive industry this year. The long-term supply situation remains to be seen.
