The problems caused by the conflict between Russia and Ukraine are beginning to affect the automotive world. At a press conference Herbert Diess, CEO of the Volkswagen group confirmed that part of the European production should soon be transferred to the USA and China, where the Group sees no political risk.
As stated by Herbert Diess himself, the war in Ukraine “He didn’t expect it”, and this has put the Volkswagen Group in serious difficulty, despite the fact that it takes great care in the selection of equipment manufacturers, paying particular attention to the stability of the country of origin. But the conflict was sudden and questions some choices made in his time. Ukraine is in fact one of the main cable harness producers along with Africa, which poses a problem for the European automotive industry. However, Volkswagen seems to have learned from this sad event: part of the European production will therefore be divided between the United States and China.
Volkswagen, the relocation of production to China and the US will be evaluated week by week
Confirming the great instability that the conflict between Russia and Ukraine is bringing to Europe, Volkswagen admits to “reconsidering” the choices week after week, even if the current situation clearly encourages the German giant to review some of its positions. Herbert Diess thus confirmed that between 50,000 and 100,000 vehicles produced in Europe by Volkswagen will be transferred (it is not clear in what percentage) between the United States and China.. The choice of China made workers turn their noses up a little, considering the tensions with Taiwan, which also in this case (but we all hope not) could lead to a new armed conflict. In this regard, Diess seemed confident of his choice, giving as a reason the fact that China needs too much economic stability, which could deteriorate following foreseeable sanctions if it attacks Taiwan.
Herbert Diess, CEO Volkswagen
The group is also working on emergency solutions for electrical wiring: if they are not as complex to produce as semiconductors, this does not prevent them from “It will take time” to set up new production units in more stable areas of Ukraine, perhaps in continental Europe itself.
Meanwhile, 2022 promises to be complex for Volkswagen and for all the major car manufacturers. The procurement of raw materials is already very complex in Volkswagen, which took the opportunity to confirm that LFP (Lithium, iron, phosphate, cobalt and nickel-free) batteries were in preparation. But in the meantime, the German company has to deal with a very high demand for electric vehicles and the impossibility of supplying them, thus extending delivery times, which are already too long for many motorists.