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The Difference Is That Multinationals Honda and Chevrolet Treat The Incident As A Suspension, Not A Definitive Closure Of Production In Brazil.
After the major exit of automaker Ford from Brazil, Audi, the German automotive company that is part of the Volkswagen group, also announced it would suspend car production in Brazil indefinitely. Now it’s Chevrolet and Honda’s turn to halt vehicle production in the country, and the automotive industry may face collapse.
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While the automotive market signals that it will still face difficulties in regaining the sales pace of the pre-pandemic period, car manufacturers have more reasons to be quite concerned.
Earlier this week, the assembly line in Gravataí (RS), where the Chevrolet Onix is produced, had to stop its activities and will remain with production suspended for at least a month — the resumption date is still uncertain.
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Meanwhile, multinational Honda announced the suspension of work at its factory in Sumaré (SP) for the first 10 days of March.
Shortage of Electrical Components Also Impacts Production of Vehicles by Honda and Chevrolet
Honda and Chevrolet are facing similar problems due to the shortage of electrical components available in the global market; industries that depend on these raw materials to manufacture their products can no longer keep up with producing their goods in sufficient quantities.
To try to delay the total suspension of their activities, the automakers Honda and Chevrolet are maintaining the assembly of models for which they still have large quantities of parts in stock.
However, this measure is temporary: if there is not a boost in the supply of electronic components, it is possible that the entire automotive industry will suffer a “blackout” of raw materials (except, of course, for companies that had established prior contracts to acquire a large quantity of the components in dispute).
In any case, it goes without saying that consumers will also end up paying the price. In the case of the Chevrolet Onix, for example, there is a risk that market demand will greatly exceed the available supply — in other words, prices are likely to increase.
So far, other manufacturers still operating in Brazil have not indicated the risk of suspension, but the Volkswagen Group has already stated that it will experience a global production cut of 100,000 vehicles in the first months of this year due to the shortage of raw materials.
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