Automakers around the world have certainly felt the impact of semiconductor shortages, with an estimated $210 billion revenue lost globally in the sector in 2021, SSAB director of strategic development Arnaud Guerndel said at the Kallanish Europe Steel Markets conference in Amsterdam this week.

“This problem has caused manufacturing lead times to increase from an average of three to four months to an average of 10-12 months,” he noted. “The lack of sufficient semiconductors caused widespread production cuts around the globe. Around 18 million vehicles were not produced as scheduled in 2021-2022. As an example, in 2021, GM plants ran at only 60% capacity in Q3 as a result of scheduled downtime versus 112% capacity during the same period in the previous year.”

This year, the expectation is that the automotive industry will lose 1.3 million units, but the problem is easing in the sector, Guerndel added.

According to him, China continues to be the world’s largest vehicle market, with the Chinese government expecting that automobile output will reach 30 million units by 2020 and 35 million by 2025. “As an exporter, China has overtaken Germany and is concentrating its development on electric vehicles. Earlier, we visited several Chinese car plants and they do not look any different than in Europe,” Guerndel commented.

“Abating CO2 emissions is one of the major challenges for the steel industry,” he observed. “In this context, the current best possible routes are based on hydrogen DRI use, scrap using EAF technology, or a combination of bio-fuels and carbon capture keeping current blast furnaces. According to Capex surveys, average conversion cost to zero CO2 emission is equivalent to €350-600 million for each annual million tonnes production capacity.”