European car sales dip as Ukraine war hits struggling industry

Car sales in Europe dropped sharply in March, industry data showed Wednesday, as Russia’s invasion of Ukraine added to the woes of a sector that has been long struggling with shortages of semiconductors.

Passenger car registrations fell 20.5% compared to the same period last year, with 844,187 units sold, according to the European Automobile Manufacturers’ Association (ACEA).

Excluding 2020 when the coronavirus pandemic paralyzed the global economy, it was the worst performance for a month of March since statistics began in 1990.

Car production has been hampered worldwide since last year by a severe shortage of semiconductors, a key component for modern cars as they power everything from antilock braking systems to airbags to parking assistance technology.

The war has led to shortages of other parts, such as the cables used in car wiring harnesses and of which Ukraine is a manufacturer.

Several factories in Europe have had to go idle due to the lack of cables, with Volkswagen temporarily suspending production at a number of German sites.

Europe’s top automaker saw sales fall by nearly a quarter in March, according to ACEA figures.

“The ongoing supply chain disruptions, further exacerbated by Russia’s invasion of Ukraine, negatively affected car production,” the ACEA said.

Most countries in Europe had double-digit drops in car sales in March, the association said, with a fall of 17.5% in Germany, the biggest market.

There were even larger falls of around almost 20% in France, around 30% in Italy and nearly 40% in Spain.

Outside the European Union, sales fell by 14.3% in Britain.


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