Volkswagen is considering stopping the production of some car models and components outside Europe if the conflict between Russia and Ukraine continues over time.
This will open the doors to the countries where the German brand has plants in the rest of the world, such as in Latin America (in Mexico, Argentina and Brazil) and in China.
In fact, the car manufacturer has already taken part of the productions to other countries to avoid further complications.
Said the CEO of VW, Herbert Diessto journalists this Tuesday, March 15: “We have to think about additional investments in the US and other countries abroad.”
And he also warned that, for the time being, “the specific effects of the armed conflict cannot be analyzed conclusively.”
Russia’s invasion of Ukraine forced Volkswagen to close plants in Germany due to lack of inputs, especially electrical and cable systems that are manufactured in kyiv.
Diess confirmed that this is the biggest problem facing the brand today, which is why a group of 150 people in Wolfsburg is looking alternative suppliers in all parts of the world.
Here are also possible businesses for potential suppliers from Brazil, Mexico and Argentina.
Currently, VW has already moved the production of some 100,000 vehicles to other plants, but the “move” could be larger to get around supply bottlenecks.
VW considers moving manufacturing outside Europe if Ukraine conflict spreads
VW is one of a number of automakers, including GM, Ford Motor Company and Toyota, that were forced to cut production last year due to a shortage of semiconductor chips.
The shortage of supplies was motivated by factors ranging from an increase in the demand for electronic devices during the pandemic, to problems in transfers (the container crisis).
The conflict in Ukraine adds problems to the industry just when it was beginning to resurface.
If work is added to the Mexican subsidiary of Volkswagen, it could be more than interesting to add quality work.
VW generates about 10 percent of jobs in the country’s automotive sector.
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