Russia-Ukraine Conflict: Impact in the automotive industry

Last updated: 29 March 2022


The Russia-Ukraine conflict is further straining the automotive supply chain, which has already been battered by the Covid-19 pandemic crisis and the chip shortage crisis.

Ukraine is a major supplier of automotive cabling but is now unable to secure supplies and alternatives to the supply chain for these components are not immediate.

Russia is also a supplier, notably of lithium for batteries, which will also affect the supply chain.

In addition, many Eastern European workers have left the factories to fight in the conflict, and there is already a shortage of labor in the sector.
The combination of these factors could cause failures in the supply of components for the automotive sector, and it will take some time to relocate production centers or find alternative supply sources in a global level.

Portuguese companies that produce components like those of the countries affected by the conflict should be aware of the possibility to replace in the production chain those companies that are unable to supply.

Finally, the road transport of goods from Ukraine has also changed because it is now more focused on the transport of humanitarian help and refugees.