Shortages of Russian gas could damage EU auto supply chains

With winter on the horizon, European vehicle manufacturers face fragile supply chains and reduced consumer demand. By Will Girling

Russia’s invasion of Ukraine in February 2022 precipitated short-term and long-term constraints for the European automotive sector. In the first instance, Ukraine’s output of electrical components was halted and then severely reduced for three months. This was broadly resolved by Q2, according to Moody’s.

However, as the conflict draws on into Q4, a bigger cause for concern is materialising: the disruption of natural gas supplies. While access to this energy source has been restricted and prices have increased since the start of the year, it did not previously result in physical shortages. Matthias Heck, Vice President and Senior Credit Officer at Moody’s, suggests to Automotive World that this equilibrium might soon deteriorate.

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