Suzuki Hungary has declared the suspension of its automobiles export to Russia and Ukraine, which has contributed to a long line of war-related repercussions in the auto sector.
Reuters has noted it as the first hint of the crisis resulting in a broader economic impact.
The statement came in the wake of Russia’s invasion of Ukraine which has also caused an ‘economic fallout’ in Central Europe. Russia’s actions triggered harsh international restrictions and mounting economic hardships in both countries. However, the dispute appears to have no impact on Suzuki Hungary’s production.
“Our company has no direct Tier 1 suppliers in the areas affected,” its spokesperson, Zsuzsanna Bonnar-Csonka, told Reuters. “However, we are continuously monitoring the entire supply chain,” she added.
Bonnar-Csonka sees the global shortage of the semiconductor microchip scarcity as the main issue in Suzuki Hungary’s manufacturing. The company is also experiencing difficulties due to rising energy costs and the devaluation of the country’s currency.
Suzuki Hungary distributes 10,000 automobiles to Russia and Ukraine each year but it now intends to shift its affected orders to other markets to offset the deficit caused by the suspension of exports. It had delivered about 120,000 cars in 2020, of which around 100,000 were exported. This indicated that Ukraine and Russia and accounting for one-tenth of their total exports.
The dispute between Russia and Ukraine has already resulted in sanctions from a number of automakers, some of which have shown their support by donating millions of euros to relief campaigns while others have shut down their operations. Even Russia’s most prominent car brand ‘Lada’ has halted production due to a lack of supplies on account of the war.
Source: Pro Pakistan