Auto & Transportation

Carbon black is an important component of automobile tires. Now, Germany has encountered a "carbon black crisis", and Germany's carbon black mainly comes from Ukraine. Although there are many other countries in the world producing carbon black, supply chain problems cannot be solved in an instant.

After the shortage of raw materials, the new crown pneumonia epidemic prevention policy and the conflict between Russia and Ukraine - several major factors are intertwined, the German commodity market has suffered a lot of pressure. The auto parts market has also been affected, following rising energy, food prices and supply shortages.

German "Focus Online" reported that it is well known to the public that without natural gas, industrial production is unsustainable, but people may not know how the lack of ammonia will affect diesel vehicles. Ammonia is an important substance used in the production of urea for vehicles (AdBlue). Without urea for vehicles, diesel vehicles will not start. In addition, vehicle urea can effectively reduce the content of nitrogen oxides in vehicle exhaust and reduce air pollution.

Lack of carbon black makes car tire production urgent

Carbon black is a waste material after industrial production, but it is also an important component of automobile tires. Typically, a car tire contains 3 kg of carbon black.

Now, Germany has encountered a "carbon black crisis", and Germany's carbon black mainly comes from Ukraine. Although there are many other countries in the world that produce carbon black, such as India, the supply chain problem cannot be solved in an instant. The German Rubber Industry Association said that car factories in France and Italy have stopped production due to a lack of carbon black, and Austria reported that the eastern European Union countries will also encounter the problem of car factory shutdowns in the future.

On the one hand, consumers need to consider the issue of tire price increases. Michelin announced price increases as early as April 1, and other tire companies have also issued or are about to issue price increase notices. Some tire prices will increase by double digits. On the other hand, some models of tires cannot be shipped at all due to tight production and supply chains.

Stockpiling tires now makes little sense

According to the report, starting to stock up on tires now makes little sense. The reason is that rubber has an aging period, and even unused tires will become hard and brittle, making them unusable.

In addition, components such as motorcycle oil are also facing rising prices and tight supply chains. German media said that not only the price of used cars has increased, but the price of the parts market has also risen sharply. BMW, for example, has tripled the price of some parts, and parts have increased by more than 10 percent overall.

Increase in prices of new and used car parts

The German ifo economic institute said that the vast majority of companies will increase commodity prices, especially bulk trade (79.3%) and retail (75.4%) plan to increase prices, including the automotive industry.

Car drivers must be aware that price increases have a delayed effect. This effect causes businesses to start stockpiling worn and replacement items. Markus Winter, president of kfzteile24, one of Germany's largest auto parts online stores, was quoted as saying, "Especially in March, our customers increased their bookings, and according to estimates, many customers are hoarding."

For their own sake, companies will not let customers stand in front of empty shelves. For example, there is currently no shortage of automotive urea, because automotive urea manufacturers have reached agreements with ammonia producers, but the price of automotive urea will undoubtedly increase.