According to the Economic and Steel Market Outlook 2022-2023/Q3 2022 Report from the Economic Committee of the European Steel Association (EUROFER), automotive output in the EU fell for third consecutive quarter, decreasing by 10 percent year on year in the first quarter this year, following a decrease of 14.6 percent recorded in the previous quarter.
Supply chain issues and overall uncertain outlook of the industry negatively impacted automotive output. The invasion of Ukraine by Russia in late February 2022 has worsened the already subdued outlook even further.
Ongoing disruptions on the supply side, in particular the shortage of semiconductors chip as well as hikes in energy prices and soaring shipping costs, continued to significantly affect automotive industry. This situation also contributed to continued depressed demand. According to the latest data, passenger car registrations in the EU continued their downward trend. In June passenger car registrations in the EU fell by 15.4 percent, while in the first half, registrations in the EU decreased by 14 percent, both year on year.
Following a decrease of 20.4 percent in 2020 due to the impact of the pandemic, automotive output rebounded by 3.4 percent in 2021. The automotive output in the EU is expected to drop by 0.5 percent in 2022, due to the ongoing supply chain disruptions and the war between Russia and Ukraine. These downside factors are expected to persist throughout 2022 and at least until the first quarter of 2023. As for 2023, EUROFER expects the automotive output in the EU to rebound by 4.9 percent, provided that supply chain issues and global uncertainty ease substantially.