The car does not know the crisis

For the first half of 2022, car manufacturers announced record financial results. Although sales of new cars in Europe fell 14% (-12% worldwide), car brands are smiling. And for good reason! All signs are green.

At Stellantis we recorded for the first half a turnover (88 billion euros) of 17% compared to the same period last year. Current operating income increased 44% with double-digit margins in nearly all global markets.

On the side of the Renault group, optimism is also in order. Turnover remained stable at approximately 21.1 billion euros (+ 0.3%), despite a decrease in sales volume of 16%. The operating margin increased by 2.6 points a year. The manufacturer posted a 4.7% operating margin excluding Russia, with net income from continuing operations of 657 million euros in the half. This is due to the sale of more expensive and better equipped cars, with a small discount. Especially in the profitable segment C (Arkana, Austral, Mégane). ” From an operational point of view (except for the abandonment of Russian activities that burdened the group’s accounts) this is the best result of the last ten years, it marks a change in recent history of Renault. we explained on the side of Boulogne Billancourt.

French manufacturers are not alone. Volkswagen increased its revenue by 5.7% in the first quarter. Same euphoria in the United States. Ford announced a profit of 19%.

The car does not know the crisis

End of the semiconductor crisis

Will the shortage of semiconductors soon become a thing of the past? The situation improved. Many manufacturers have announced the return to normality at the end of 2023. Thomas Schäfer, President of the Volkswagen brand, wants to be more optimistic and announces ” for the second half of the year (…) the improvement of the supply situation. »

With the goal of better manufacturing and delivery times. Because if Renault claims to be able to deliver an Arkana today in thirty days, the average waiting time for all orders is more than four months.

The semiconductor crisis limited the production of the vehicle, approximately 300,000 units of Renault, and more than 100,000 units of Ford. In any case, everything is in the starting blocks. The automotive supplier Forvia, born from the merger between Faurecia and the German Hella, published on Monday an operating result that was higher than expected in the first half. And the orders are in. Proof of the optimism of car manufacturers about the revival of sales.

The car does not know the crisis

Full order books

Due to the lack of semiconductors and the partial shutdown of production units, manufacturers cannot meet the demand. At VW, the order book, all engine types combined, amounts to 728,000 vehicles for Europe alone, including approximately 139,000 ID.s 100% electric. However, in the first half of 2022, the German brand was only able to deliver 488,468 vehicles. The team is working to further reduce delivery times for customers and process more of the large order book as quickly as possible. Ditto for Renault or Stellantis where orders are going well. The increase in fees will be done gradually. But at the moment it is impossible to deliver faster.

The car does not know the crisis

Increased cost of raw materials

If the forced march towards electricity and the crisis of semi-conductors seems to have been solved, the rising cost of raw materials remains the main concern that car manufacturers have to face.

Over a year (January 2021-2022) the price of lithium increased by 13% since the beginning of 2022. The price of nickel appreciated by almost 60% since 2020. At the same time the price of copper increased by 27 %, that of palladium by 30% Like rubber, its increase last year reached 16%. Not to mention rising energy prices. Result: the production cost of an electric car has increased by € 4,500 compared to 2020. This is mainly the weight of equipment manufacturers, but also of manufacturers. At Renault, for example, the impact is estimated at 797 million euros. After increasing the selling prices of their cars to improve their margins, manufacturers cannot pass on all of this inflation. Over the past three years, the price of new cars has jumped 20%. And it seems very difficult to bear the customer the full sum of the current and future increases. Because if there is a recovery in production volume, the price of raw materials will continue to rise. As a result, some brands are playing it safe for the future.

The car does not know the crisis

Reasoned optimism

GM Chairman Mary Marra did not hide her fear about the economic situation “to the point” due to also modeling several slowdown scenarios. “Same story with Volkswagen.” We expect the impact on commodity and energy prices to be higher in the second half of 2022 than in the first half. said Alexander Seitz, CFO of Volkswagen.

Despite rising commodity and energy prices, builders are changing their outlook upwards. ” We are confident that we will more than offset the price increases and continue our positive trend. So we raised our outlook, provided the supply situation improves as expected. For the full year 2022, we are now targeting an operating return on sales before special items of 4-5% “, assures the VW financial director. Renault has also changed its financial outlook upwards for 2022. Like almost all manufacturers. We are talking about a car crisis! What crisis?

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