BERLIN, Oct 25 (Reuters) – German carmakers will reveal the extent of the dent a global chip shortage has made in their third quarter earnings over the next ten days, as investors fret over the next bump in the road.
The scarcity intensified in the three months to the end of September, with passenger car output at German plants 35% below 2019 levels, auto industry association data shows, hitting sales of Volkswagen (VOWG_p.DE), Daimler (DAIGn.DE) and BMW (BMWG.DE).
The lightweight material could pose the next supply chain challenge for the industry, analysts said, as China limits output to reduce its carbon emissions.
Daimler CEO Ola Kaellenius said last week that the company expected chip supply to stabilise in the fourth quarter, but warned a return to normality could take until 2023. read more
Carmakers including Daimler prioritised high-margin vehicles when distributing the fewer chips they had, which helped them to post bumper first-half profits, with some even raising outlooks.
Although it managed supply chain issues better than others, a lack of new models compared to Daimler and Tesla (TSLA.O) could make it hard to regain momentum, RBC analysts said.
Volkswagen CEO Herbert Diess, meanwhile, has hammered home in recent weeks the urgency of keeping up with Tesla as the U.S. electric vehicle (EV) maker encroaches on German turf with a giant factory and battery plant. read more
Based on Refinitiv estimates, Volkswagen is expected to report pre-tax profits of 2.99 billion euros on Oct. 28, down from 3.2 billion euros last year, with a unit loss of around 500,000 vehicles this year so far.
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