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The Ukrainian crisis is not yet affecting our car industry

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“Fiat” workers are not on paid leave due to lack of raw materials, but because no one orders cars from this company

“Fiat” workers have been on paid leave for two weeks now, and April 12 will be their first working day. But unlike the rest of the world, where the car industry is slowing down due to a shortage of materials, the Kragujevac factory does not have that problem. It lacks car orders, which it produced only 27,000 last year, and could do nearly ten times as many.

Sasa Djordjevic, president of the “Fiat” union, says that they are specific in terms of work and non-work, and that they are immune to the global trend of shortage of raw materials.

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– That doesn’t affect us at all. If we had a more serious work plan, in terms of the number of vehicles measured in the hundreds of thousands, this shortage would surely stop us. But we are operating according to the order plan and these are such small quantities of vehicles that we will make this year that the lack of materials does not affect us at this time, nor will it affect us to the extent that it will happen to those who produce hundreds of thousands of cars a year – explains Djordjevic . He adds that the situation in the world car industry is worrying, since in Germany, for example, “Audi” is stopping production, and the MAN truck factory has been standing for two weeks.

Components who are not related to “Fiat”, such as “Jan Feng”, who already work for “Mercedes” and “Volkswagen”, are currently operating normally in Serbia and have no announcements of any reduction in production.

The Serbian Chamber of Commerce (SCC) confirms that companies from the automotive industry are still working without major problems, but they expect the consequences caused by the reduction in the volume of car production worldwide. Raw material prices are rising, but there are also stocks.

The situation in the automobile industry is becoming more complicated, because several companies in Serbia already have a problem in the organization of production due to the lack of raw materials, according to the PKS. They add that in general, companies from the metal and electrical industry sector have problems in functioning.

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Russia is one of the world’s leading producers of aluminum, copper, palladium and nickel, which are used in the automotive industry. Ukraine also produces precious neon gas, which is used to produce chips, and the main component in the automotive industry that comes from this country are cable bundles. So after the crown, the Ukrainian crisis is another strong blow to the European car industry.

Copper producers, traders and banks that finance them had a meeting in Chile for the first time since 2019, at which it was emphasized that the price of copper can be expected to increase in the coming period, because the lack of supply will continue. Russia will forward copper intended for Europe to China.

For now, copper and aluminum, according to PKS data, are produced without major disruptions in Serbia.

The price of these goods on the stock exchange is rising, which affects domestic producers. They currently have raw materials for the next six months, the PKS notes.

Copper is worth $ 10,367 per ton on the stock exchange, although it has been priced at more than $ 10,000 since the middle of last year, the highest in 20 years. Aluminum has also become more expensive. At one point, a ton was paid for 4,000 dollars, which is 45% more than at the beginning of the year. It was sold yesterday at a price of 3,551 dollars per ton, which is still significantly above pre-crisis prices. Aluminum is especially important for the industry because it is used in the production of drink cans to electric cars. High gas prices have already knocked out an aluminum smelter in Europe with a capacity of 900,000 tons.

Palladium, rhodium and platinum are used in catalysts that control gas emissions from gasoline cars. Russia is a large producer of palladium, since the company “Norilsk Nickel” produces about 40 percent of this metal in the world. Palladium has risen about 20 percent in the last month and is currently selling for about $ 2,000 per ounce, which is significantly lower than on March 8, when it was worth $ 3,200 per ounce.

The price of nickel, which is used to produce batteries for electric cars, rose about 15 percent for the second day in a row on the London Stock Exchange and reached $ 32,932. The price of this metal increased by about 53 percent during March, which clearly indicates the “savagery” of this metal on world stock exchanges since the outbreak of the Ukrainian crisis. On March 8, the world was shocked by the news from the London Metal Exchange, the largest of its kind in the world, that after the price of nickel reached $ 100,000 per ton, trade in that metal was suspended. A year ago, a ton of nickel cost about 16,000 dollars, and a month ago 23,700. In 2021, Russia was the third largest producer in the world with about 200,000 tons. Analyzes are already appearing that the increase in the price of nickel will permanently slow down the use of electric cars, which is one of the pillars of the green transition in the developed world.

The microchip crisis has been going on for two years, due to the interruption of supply chains caused by the crown, but also due to the huge demand, primarily in the automotive industry, but also in other industries. The Ukrainian crisis can only deepen that problem, because the precious gas neon is used in the production of microchips, and 70 percent of the world’s production is in Ukraine. In addition, European car manufacturers from Ukraine import cable bundles, which are the main transmitters of electricity and information in the vehicle.

Production of questionable tires

The rubber industry predominantly imports certain raw materials from Russia and Belarus, such as industrial soot, rubber and cord. Given that multinational companies operating in Serbia have certain standards for suppliers (although for all raw materials, there are more than 10 alternative countries from which imports are possible), the question is whether suppliers can meet the conditions, according to the SCC. .

Some producers have stocks of raw materials in six months, but the plants are asking to send some raw materials to their factories in the EU in order to avoid production delays, and because of the savings in raw materials, they are asking for a reduction in production in Serbia, Politika writes.

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