Volkswagen found itself in big trouble: Sales fell by a quarter

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Volkswagen found itself in big trouble: Sales fell by a quarter

German car giant Volkswagen said on Friday it had sold a quarter fewer vehicles in the first five months of this year due to a shortage of chips than in the same period last year. In the period from January to May, 3.07 million vehicles were sold, according to VW.

Sales were thus reduced by a quarter, and the same percentage drop was recorded in the last month of that period, with 658,000 vehicles sold. The lack of microchips is creating problems, and sales in the important Chinese market are only now beginning to recover from the effects of lockdown, the company points out.

But the situation with microchips and sales in China should improve for the rest of the year, says CEO Herbert Diess.

The war in Ukraine also affected production

The war in Ukraine also disrupted the wiring industry; many of these factories are based in Ukraine due to its lower wages.

Wiring is essential for the modern automobile, which contains 3 kilometers of it. Sales fell 22.9 percent in Western Europe and 23.8 percent in China. The central VW brand sold 23.3 percent fewer vehicles, but Škoda recorded an even bigger decline, by as much as 39.3 percent.

Audi sales fell 21.3 percent and Porsche sales 10.4 percent. Traton sold significantly more trucks and buses from MAN, Scania, Navistar and the South American brand VW Caminhoes e Onibus, with a growth rate of 15.8 percent, only because VW has included Navistar based in the USA since July last year.

-in. Without Navistar, Traton would have fallen, data show.

New threats are emerging from all sides

"The automotive industry is now operating in an economy of scarcity," said Denis Schemoul, director at S&P Global Mobility.

"New threats are emerging from all sides: to palladium, which is needed for catalytic converters; to small analog chips, which are everywhere in vehicles; to plastics, because of the Russian oil embargo; to neon, a gas that is essential for semiconductor production and which Russia is threatening to remove access to; or simply to natural gas, which provides energy to many factories."