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Auto Sales Are Drying Up As Semiconductor Shortage Worsens

The Automotive Monthly Metals Index (MMI) held flat for this month’s reading, as U.S. auto sales slumped in Q3.

US auto sales slip in Q3

General Motors reported its third-quarter sales fell from 665,192 vehicles in Q3 2020 to 446,997 vehicles in Q3 2021, a 32.8% drop.

The automaker cited semiconductor supply chain disruptions and “historically low inventories.”

“During the quarter, GM provided an update for investors that its wholesale volumes in North America in the second half of 2021 would be down about 200,000 units from the first half, largely because of supply chain disruptions in Malaysia caused by COVID-19, with most of the impact occurring during the third quarter,” the automaker said. “GM’s financial outlook is still expected to be within the calendar year guidance range previously provided as the company continues to develop solutions to mitigate the impacts of the semiconductor shortage and Chevrolet Bolt EV recall.”

Meanwhile, Ford reported total sales in the U.S. fell 17.7% in September. Unlike its truck and car segments, Ford SUV sales jumped by 3.4%.

“August improvements in production and inventory paid off in September, with Ford’s retail sales up 34.3 percent over the previous month, boosting Ford’s retail share for the month to an estimated 12.9 percent – up 3.8 percentage points over August,” Ford said.

Fiat Chrysler reported MID=23">sales fell by 19% to 410,917 in Q3 2021.

“While the various supply chain issues facing our industry continue to impact available inventory, we know the demand for our vehicles is still there,” U.S. Head of Sales Jeff Kommor said. “Calendar year-to-date, total sales improved 3% versus this time last year.”

In addition, Honda reported its U.S. sales fell by 10.9% to 345,914 vehicles in Q3 2021. Its September sales fell by 24.7% to 95,816 vehicles.

Chinese auto sales decline

Meanwhile, Chinese auto sales fell on a month-over-month basis for the fifth straight month in August, the China Association of Automobile Manufacturers reported last month.

Chinese auto sales totaled 1.80 million vehicles in August, down 3.5% from the previous month. On a year-over-year basis, sales slipped by 17.8%.

Sales from January to August totaled 16.56 million vehicles, or up 13.7% year over year.

GM, GE Renewable Energy sign MoU

As we noted this morning, this week GM announced an agreement with GM Renewable Energy through which the parties will work to develop the supply chain for rare earths and other materials used in electric vehicles and renewable energy.

The parties will “evaluate opportunities to improve supplies of heavy and light rare earth materials and magnets, copper and electrical steel used for manufacturing of electric vehicles and renewable energy equipment,” GM said.

GM said the companies will initially focus on building a vertically integrated magnet manufacturing supply chain based in Europe and North America. Furthermore, they plan to collaborate on supply chains for other materials, including copper and eSteel.

Ford announces plans for battery manufacturing campus in Kentucky

In other electrification news, Ford announced plans late last month to build a new battery manufacturing campus in Glendale, Kentucky.

The facility will produce batteries for the “next generation of electric Ford and Lincoln vehicles.”

Ford plans to invest $5.8 billion to build the BlueOvalSK Battery Park. In addition, it plans to add 5,000 jobs.

Actual metals prices and trends

The U.S. hot-dipped galvanized price rose 1.4% month over month to $2,222 per short ton as of Oct. 1. Meanwhile, the U.S. shredded scrap steel price fell 5.1% to $467 per short ton.

The LME three-month copper price fell 3.1% to $9,165 per metric ton.

The Korean 5052 aluminum coil premium over 1050 rose by 4.3% to $4.08 per kilogram

By AG Metal Miner

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