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Car dealers face further new car delays as manufacturers announce factory closures

  • Parts supply issues from Ukraine are having a knock-on effect on car production
  • VW, Porsche, BMW and Mini have already announced factory closures
  • Changes to manufacture expected to be costly and new car orders could be delayed

Time 11:03 am, March 3, 2022

Car dealers are facing further new car delays as several manufacturers announced they would be forced to close factories due to parts supply issues from the Ukraine. 

Volkswagen has already closed two factories in Europe because of this, as well as Porsche’s Leipzig factory.

BMW announced earlier in the week that Munich and Dingolfing, both in Germany, would shut and its UK Mini plant will also close next week.

The FT reported that another car maker had also said it had enough supply of car parts to keep plants open until next week but could close them after that if problems persist.

Jim Holder , editorial director for Haymarket Automotive, publisher of What Car? and Autocar, commented that this is a ‘further blow for the industry’ and also likely a costly one.

He said: ‘Beyond the delays, it seems certain that hastily arranged alternatives will also be more expensive – and it’s more than likely that consumers will be expected to bear the brunt of rising costs.’

Holder explained that this isn’t simply an issue of supply delays, factory closures are expensive and this situation has the potential to escalate.

‘While everything has to be seen in perspective, this is another blow for the industry.

‘The reliance, particularly among the German and Czech car makers on Ukrainian suppliers, most notably around electrical wiring looms, is coming into sharp perspective now,’ he said.

‘Factory stoppages are difficult, expensive and of course delay production. It’s a double body blow for many too, as many of the cars affected appear to be electric ones, hitherto one of the few areas of good news for the industry.

‘Unlike the pandemic, however, the potential for this situation to escalate into a crisis was in plain sight for some time, and the hope must be that contingency plans are well advanced – albeit, as we’ve learned in the chip crisis, swapping suppliers can often be time consuming and expensive.

‘The fact that these problems have hit factories so quickly doesn’t imply everyone has advanced alternative plans in place though, and also raises questions again about Just In Time manufacturing practices and the impact of concentrating supply on a limited number of sources.’

Rebecca Chaplin's avatar

Rebecca has been a motoring and business journalist since 2014, previously writing and presenting for titles such as the Press Association, Auto Express and Car Buyer. She has worked in many roles for Car Dealer Magazine’s publisher Blackball Media including head of editorial.

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