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Skoda production has been reduced in Ukraine and Russia at risk of warning

As the Ukraine crisis deepens, Skoda said this week that it faces a critical supply shortage of parts from several suppliers in Ukraine and will “limit production of the Enyaq iV from this week.”

The Volkswagen Group’s global supplier network, which includes more than 40,000 suppliers, also includes numerous suppliers in western Ukraine; The Czech-based Skoda seems particularly vulnerable.

VW Group Procurement Analysts will work to quickly assess the moving situation, quantify risks, and discuss alternative source strategies for critical parts.

In addition to the unknown magnitude and duration of potential delivery delays, GlobalDataThe global car sales base also highlights the importance of the Russian car market for the brand. 2021 data show that Russia was Skoda’s second largest market after Germany (See data table below).

In Russia, Skoda produces Rapid, Octavia, Karoq and Kodiaq models in two facilities. In Nizhny Novgorod, Skoda produces three models – Octavia, Karoq and Kodiaq. Rapid is manufactured at Skoda’s Kaluga plant.

Skoda says production is still ongoing at its Russian plants, but adds that “the impact of possible delays on supply chains is constantly being analyzed.”

In addition to problems with parts deliveries, the current concern will be the impact of economic sanctions on Russia and the collapse of the Russian currency – which will lower the threshold for any car sold there, even if they can continue beyond the inventory of finished cars.

The long-term concern for Skoda and the Volkswagen Group as a whole will undoubtedly be the state of the sales environment in Russia.

Skoda car sales by market, 2019-2021

Skoda production has been reduced in Ukraine and Russia at risk of warning

Source link Skoda production has been reduced in Ukraine and Russia at risk of warning

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