VW’s Skoda says Ukraine partner making wire harnesses again

PRAGUE — Skoda Auto, a part of the Volkswagen Group, mentioned on Tuesday its provide associate in Ukraine had determined to restart manufacturing of wire harnesses which ought to enable the Czech carmaker to renew manufacturing of its electrical ENYAQ iV mannequin.

Russia’s invasion of Ukraine has added to provide chain issues for international automakers — which had been already combating semiconductor shortages which have lower manufacturing — with a break in deliveries of wire harnesses from the war-torn nation.

Whereas Skoda, the Czech Republic’s largest exporter, mentioned it expects the provision of semiconductors to enhance within the second half of 2022, it mentioned the struggle in Ukraine and provide bottlenecks will put a major burden on its working enterprise.

Skoda’s 2021 deliveries fell 12.6% year-on-year and earlier this month it stopped manufacturing of the ENYAQ due to harness shortages, saying that two different fashions had been in danger due to the shortage of availability of the element.

“Our associate … in Ukraine determined to restart manufacturing of wire harnesses this week, with full service and full safety for staff there,” Karsten Schnake, Skoda’s board member for buying, mentioned throughout its on-line 2021 earnings presentation.

Wire harnesses type a key a part of a automobile’s electrical system, which group and information cables contained in the automobile.

“We determined to double the manufacturing in case one thing goes improper, and this manufacturing will probably be ramped up in an alternate manufacturing facility,” Schnake mentioned, including that work there would begin in three or 4 weeks.

“Hopefully we are able to restart manufacturing of ENYAQ one or two weeks later when now we have wire harnesses,” Schnake mentioned.

Skoda delivered 878,200 vehicles worldwide in 2021, the primary time that this had fallen under the 1 million mark since 2013.

However, the VW group model’s gross sales income rose 3.9% to 17.7 billion euros ($19.5 billion) in 2021 and working revenue rose 43.2% to 1.1 billion euros ($1 billion) because it took value measures.

Skoda didn’t give a monetary or manufacturing outlook, saying there have been nonetheless appreciable uncertainties because of the battle in Ukraine and the affect on its Russian operations.

Skoda, like VW, has suspended manufacturing and different enterprise actions in Russia, which was its second-largest market final yr, with 90,400 autos delivered.

($1 = 0.9089 euros)

(Reporting by Jason Hovet, Enhancing by Louise Heavens, Kirsten Donovan and Alexander Smith)

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