French carmaker Renault has reported financial damages of € 8 billion in 2020. These are the largest losses of the company during its existence, according to the report of the auto giant.
In the second half of the year, against the backdrop of the coronavirus pandemic, working capital decreased by 8.9 percent, and a net loss of 660 million euros. On an annualized basis, car sales plummeted 21.3 percent.
The head of the corporation, Luca de Meo, said that 2021 will be difficult, as uncertainty remains associated with the pandemic, as well as with the supply of electronic components. In this regard, the company refrained from publishing its forecast for the current year.
Russian auto giant AvtoVAZ posted an annual loss of 196 million euros against a profit of 72 million euros a year earlier.
The automotive industry has previously faced a chip shortage. They’ve become harder to come by as demand for consumer electronics has skyrocketed during the pandemic. The shortage has already forced the companies to cut production volumes. For example, in January, Honda cut production at its Japanese plant by about four thousand vehicles.
Chip makers give preference to consumer electronics buyers – their orders are larger than car makers. The annual smartphone market alone is over a billion devices compared to less than 100 million machines.