A total of 844,187 vehicles were sold during the month, a drop of 20.5% compared to March 2021, and almost a third less than in 2019, the European Manufacturers Association said on Wednesday ( ACEA).

Since the end of February, the shutdown of factories of Ukrainian suppliers has added to the shortages of electronic components.

Ukraine is notably the main European supplier of wiring harnesses, parts described as the "nervous system" of cars.

The month was catastrophic in the main markets, such as Germany, France, Italy, Spain and Belgium, which recorded double-digit declines.

This is the lowest sales volume for a month of March since the start of the statistical series in 1990, excluding the exceptional case of 2020 which had paralyzed the economy at the start of the Covid-19 pandemic.

The European market has just experienced the three worst months in its history (still excluding 2020), with 2.2 million vehicles sold.

Since the spring of 2021, the automotive market has been held back in Europe and America by a series of logistical problems, including a shortage of semiconductors.

These electronic chips, mainly manufactured in Asia, are essential for the manufacture of telephones and laptops, but also cars which carry ever more technology.

With chip supply stabilizing, ACEA predicted a rebound in auto sales in the second half of 2022, but the war in Ukraine dampened that optimism.

Europe is not the only one to slow down: the market fell in the first quarter in the United States (-16%), but also in Japan, Brazil and India.

Only the Chinese market remains in very strong growth (+9%), but local confinements linked to rebounds in the epidemic raise fears of prolonged stoppages in production.

electric cars not spared

Across Europe, several factories have been put on hold for lack of parts.

Volkswagen had to temporarily halt production at several German sites, including part of its historic plant in Wolfsburg, and Zwickau, its electric car production center.

The Renault factory in Douai, which produces the electric Mégane, is also shut down for eleven days.

These shortages indeed end up affecting hybrid and electric cars whose market, in full explosion, was protected until then, notes Peter Fuss, analyst at Ernst & Young, in a press release.

"Sales of electrified cars could be much higher if the industry had been able to deliver its cars, especially since electric cars require even more chips," he said.

The chip shortage could continue until the end of 2022. "For customers, this means that there will be even fewer new cars available, delivery times will remain extremely long and prices will continue to rise, for used cars too", explains Peter Fuss.

In an economic situation complicated by inflation, in particular, the demand for cars has not fallen for the moment but this could change in the medium term, according to the analyst.

Manufacturers and equipment suppliers are expected to give more details on these slowdowns when they present their quarterly results, with Tesla opening the ball on Wednesday.

The Volkswagen factory in Wolfsburg, Germany, on March 22, 2022 Yann Schreiber AFP/Archives

The European No. 1 Volkswagen saw its sales fall by 24.3%.

But its luxury brands (Porsche, Bentley, Lamborghini and Bugatti) are resisting the crisis well.

The European No. 2, the Stellantis group, born from the merger of PSA and Fiat-Chrysler, saw its market share fall to 20% with a sharp drop in sales (-32.9%), and poor scores for Peugeot, Fiat and Jeep.

© 2022 AFP

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