Audi Not Expecting Production Issues Due To Gas Shortage

Sep. 18, 2022 4:25 PM ET by Gerhard Horn Industry News / 2 Comments

Once again, blame Russia.

The automotive industry is in a terrible state thanks to various parts shortages with no realistic end in sight.

Automotive bosses across the globe were likely hoping for some sort of relief, but alas. The shortages just keep on piling up. In late August, it was reported that Volkswagen was stockpiling automotive glass, which is set to be the next big shortage. Locally, Chevrolet has run out of hood insulation and is currently selling two models without it.

Germany could be facing a gas shortage, which will impact several German manufacturers. Audi's CEO, Markus Duesmann, was the first high-profile person to speak out about the issue, and he does not expect any global stoppages.

Germany's Federal Network Agency stated over the weekend that its gas storage facilities were 87.75% full. The big problem, in the words of Ned Stark, is that winter is coming. Demand will be heavy from both households and the commercial sector. It also doesn't help that Germany relies heavily on Russia for its gas resources.

Russia cut its ties with Germany earlier this year after the German government put the local subsidiary of the Russian energy corporation (Gazprom) under trustee management following Russia's invasion of Ukraine.

Germany's energy regulator has had to shop around to keep supplying municipalities and regional suppliers at great expense. The estimated cost in June already stood at $5 billion.

2021-2022 Audi RS5 Sportback Front Angle View

Even with reserves currently high, there are concerns as Europe heads into winter. Gas usage is going to skyrocket across all sectors, but Audi remains hopeful. Duesmann told the local Augsburger Allgemeinen newspaper that Audi will work under the assumption that there will be enough energy available.

"At the moment, I do not expect it," said Duesmann, referring to gas shortages. "[We are] in regular communication with authorities, network operators and suppliers in order to be able to implement any necessary measures."

If the worst does happen, Audi expects slower production in certain areas. Its suppliers may experience issues as a result of the same shortage, and a possible bottleneck could develop at the paint shop.

This is not the first instance of Audi experiencing problems due to the ongoing conflict. Audi has several suppliers based in Ukraine, which halted production of volume models like the A4/A5, and models with a significant profit margin, like the Q8.

In addition to the above, Audi is also experiencing the same semiconductor chip shortage, which halted production for a few weeks, and led to the creation of the Semiconductor Shortage Package.

The entire Volkswagen Group is also under pressure due to software-related issues. VW's Cariad division is struggling with software development, resulting in several models across all brands being delayed by a year or more. It's also widely believed to be why VW gave Herbert Diess the boot earlier this year.