The Automobile Suppliers Network (AMZ) has warned of a renewed collapse of supply chains in the German automotive industry as a result of the soaring energy costs. A large number of supplier companies have full order books, but are not in a position to pass on the higher energy prices to their customers because of long-term contracts, explained AMZ network manager, Dirk Vogel. The consequence: Companies may soon have to cut back their production or stop it altogether. A "far-reaching domino effect" in the closely interwoven industry is looming, he said. "The energy supply must be massively increased so that energy prices fall again," Vogel demanded.
The automotive and supplier industry is meeting this week for the Automotive Forum in Zwickau, in the eastern German state of Saxony. This will also bring together the approximately 160 members of the Automotive Suppliers Network Saxony (AMZ). According to the information provided by the AMZ, around 800 companies in the industry are based in Saxony and they employ 95,000 people. As a result of the switch to electromobility and increased digitalization, the industry has been undergoing a profound transformation for several years. In the process, the lack of semiconductors, in particular as a result of the coronavirus crisis, had led to production losses.
In a survey conducted by the AMZ, in which 58 companies participated, 70 percent rated the current energy crisis as a threat to the existence of their business. Half of the companies admitted that if they don’t increase their prices then they would have to stop production in the next few months. And almost all of them have to shoulder price increases from suppliers; one in four has already lost suppliers.
The exploding energy costs are an enormous burden for consumers and small and medium-sized companies in Germany, the managing director of the German Association of the Automotive Industry, Marcus Bollig, stressed in a statement. "Politicians must now do everything they can to reduce energy costs and ensure competitiveness for companies."
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