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Automakers shut down assembly lines over key parts shortage

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Automakers have begun shutting down many assembly lines due to deepening shortages of key auto parts such as microchips (semiconductors) and seat foam.

Multiple sources including Automotive News reported on Tuesday that production complications had hit major automakers such as Ford, General Motors, Toyota, Honda, Nissan and Volvo since last week.

While some say they will suspend production lines as they await parts, others are selectively choosing which models to produce.

Some are attempting creative workarounds, such as postponing the installation of certain electronic modules until after a vehicle is built.

It was learnt that many automakers, for instance, cannot buy the semiconductors they need because home electronics are taking all the supply.

In a piece titled ‘Lack of tiny parts disrupts auto factories worldwide’, the New York Times, reported, “Strong demand for gaming systems, personal computers and other electronics by a world stuck indoors has sucked up supplies of semiconductors, forcing carmakers around the world to scramble for the chips that have become as essential to mobility as gasoline or steel.

“Virtually no car maker has been spared. Toyota Motor has shut down production lines in China. Fiat Chrysler Automobiles temporarily stopped production at plants in Ontario and Mexico. Volkswagen has warned of production problems at factories in China, Europe and the United States. Ford Motor said it was idling a Louisville, Ky., factory for a week because of the shortage.”

The United States car giant General Motors announced early in the month that it was shutting three plants and slowing production at a fourth due to the semiconductor shortage. The automaker said it could miss its 2021 targets as a result.

“Despite our mitigation efforts, the semiconductor shortage will impact GM production in 2021,” a company spokesman said in a statement.

GM also said, “Semiconductor supply for the global auto industry remains very fluid. Our supply chain organization is working closely with our supply base to find solutions for our suppliers’ semiconductor requirements and to mitigate impact on GM.”

Several other car manufacturers have also put production on hold. For instance, Honda UK’s main plant in Swindon was shut down for several days last month due to a chip shortage, for example.

Elsewhere, Ford and Volkswagen have also shut plants or cut production while they wait for supplies to pick up.

Ford said in January that it was shutting a factory in Germany for a month, while Volkswagen said in December it would make 100,000 fewer cars this quarter as a result of the shortage.

Speaking about the chip shortage on a Davos panel on January 25, VW CEO Herbert Diess said, “We have to make sure that the markets and supply chains remain intact.”

Falan Yinug, director of industry statistics and economic policy at the Semiconductor Industry Association, says the chip shortage in the automotive industry is largely the result of substantial swings in demand due to the pandemic and the increased use of semiconductors in advanced vehicles.

“The events leading to the current auto chip shortage began during the second quarter of 2020, when automakers understandably reduced production and chip purchases as the virus spread across the globe,” Yinug recently wrote in a blog.

Executive Publisher at the Car Expert, Karl Brauer, said, “The current supply chain issues represent an unusual combination of factors, including shipping constraints, chip shortages and rising consumer demand.

“While consumer demand was a key component in 2020’s reduced new-car sales, production and distribution constraints will likely be the limiting factors for 2021.”

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$1bn investment recorded in auto industry – Minister

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The Federal Government has recorded more than one billion dollars’ worth of investments in the automotive industry. Minister of Industry, Trade and Investment, Otunba Adeniyi Adebayo, said this in Abuja on Tuesday when he featured at the 20th edition of President Muhammadu Buhari’s administration scorecard series organsied by the Federal Ministry of Information and Culture.

“Over one billion dollars in investment has been recorded in the automotive sector and we are ready to move on to the next phase for the automotive industry,” the minister said.

He said the review of the National Automotive Industry Development Plan (NAIDP) was almost completed, adding that the plan was going through validation process.

Adebayo restated the ministry’s commitment toward enabling business environment to attract and retain investments.

According to him, the ministry and the Nigerian Investment Promotion Council (NIPC) are committed to attracting and protecting investments that genuinely benefit Nigeria and its citizens.

He said that the revised Bilateral Investment Treaty (BIT) would boost investment.

“Nigeria has successfully revised its model Bilateral Investment Treaty (BIT) to include a specific provision for investment facilitation, which institutionalizes the principle of assisting investors in completing their investments.

“We are proud to offer Nigeria’s first investment policy to the Federal Executive Council (FEC) for approval.

“This strategic statement, which will outline our priorities, aims, commitments, and expectations, is a turning point for the Federal Ministry of Industry, Trade, and Investment and Nigeria as an investment destination,” he said.

Adebayo, who said that Nigeria had Investment Promotion and Protection Agreements (IPPAs) with Singapore, Morocco, and Saudi Arabia to attract and retain investments, said the ministry was developing more.

“We have IPPAs with Singapore, Morocco, and Saudi Arabia to attract and retain investments. The president ratified both accords on Sept. 16, 2022 and we are developing more IPPAs,” he said.

Adebayo said the ministry also distributed 5,571 acceptance certificates worth N7.7 trillion to 2,665,800 firms.

“The acceptance certificates allow businesses claim tax reduction when computing Company Income Tax.

“We also issued more than 130 Production Day Certificates, a crucial Pioneer Status Incentive step,’’ the minister said.

To further accelerate industrialisation, Adebayo said that the ministry was expediting the establishment of Special Economic Zones (SEZs) across the country.

According to him, the special economic zones will increase infrastructure availability and provide fiscal incentives for value addition.

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Famous 4×4 Grenadier coming to Nigeria, courtesy Coscharis Motors

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Coscharis Motors has announced its readiness to introduce the popular rugged off-road vehicle, Grenadier, to the Nigerian auto market.

This follows the naming of the auto company by INEOS Automotive as its official retail partner in Nigeria.

Nigeria is the sixth market in Sub-Sahara Africa to join the brand after South Africa, Kenya, Tanzania, Namibia and Botswana.

A statement on Monday by Abiona Babarinde, the auto firm’s General Manager, Marketing and Corporate Communications, said, “The first Grenadier demonstrator vehicles are expected to arrive in Nigeria in early 2023 with customer deliveries expected to commence within the first quarter.

“All after-sales servicing will be conducted at a dedicated workshop also located in Lagos.”

Commenting on this partnership, the President/CEO of Coscharis Group, Dr Cosmas Maduka, said, “We are proud that INEOS Automotive has appointed Coscharis Motors to represent its brand in Nigeria. “This milestone marks another step in the evolution of our company. With our history and experience of the Nigerian market, we know that the INEOS Grenadier is going to be a serious player in the off-road segment.

“We have no doubt that the Grenadier has what it takes to handle Africa’s tough terrain and that it is the perfect option to meet the specific demands of those who need a capable, refined, and reliable off-road vehicle in the region. We look forward to the first customer test drives and hearing public feedback, because this vehicle is definitely going to stir things up in Nigeria.”

The statement quoted Tim Abbott, INEOS Automotive’s Head of Region South Africa and Sub-Sahara Africa, as saying, “We are carefully selecting our partners across the SSA region, to find people who know their local market and customers, and also understand our brand.

“Coscharis Motors shares our belief that the INEOS Grenadier is the perfect vehicle not only for Nigeria, but for the continent. Our shared passion for off-roading, along with their excellent reputation in the automotive industry, makes it the perfect partnership for Grenadier in Nigeria.”

Coscharis says the Grenadier has been developed to be refined on the road and extraordinarily capable off-road.

“The Grenadier is powered by a choice of two straight-six, 3.0-litre BMW engines. Both the BMW B57 diesel and B58 petrol powertrains have a proven track record, regularly appearing in top ten world’s best engine lists since 2016. They have been used in everything from sports cars to SUVs.

“The two power units bring BMW’s sophistication and refinement to the Grenadier, but they have been enhanced by INEOS Automotive’s engineering team. As well as providing powerful acceleration on tarmac, they also deliver peak torque at low revs – sustaining it through the rev range – for optimal off-road performance,” it states.

It also notes that the carefully calibrated characteristics help the driver to confidently manage the vehicle’s momentum and grip without stressing the engine, ensuring full control when tackling tricky terrain.

It adds, “The refined turbo petrol engine produces 286PS (210kW) and 450Nm (332 lb ft) of torque, while the twin-turbo diesel generates 249PS (183kW) and 550Nm (406 lb ft), for even greater pulling power. Start/stop is built-in, increasing range and preserving air quality when the vehicle is stationary.

“While it is every inch a rugged 4X4, it ticks all the right boxes on the road, too. The chassis combines a five-link suspension setup with Brembo brakes and Bridgestone tyres, meaning the Grenadier is composed, well- mannered and fun to drive no matter what the terrain.”

The firm also reveals that by the end of this year, INEOS Automotive plans to have a network of more than 200 sales and service sites for the Grenadier spanning over 50 countries, including established dealer groups, 4X4 specialists and agricultural equipment dealers.

 

 

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Lagos gov, FRSC boss for Nigeria Auto Awards where Chinese, popular brands will flex muscles

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The Lagos State Governor, Babajide Sanwo-Olu, and the Corps Marshal of the Federal Road Safety Corps (FRSC), Dauda Biu, will be special guests at the forthcoming Nigeria auto industry award.

The award scheduled to hold at the Oriental Hotel in Victoria Island, Lagos, on February 9, 2023 will witness the emergence of the car of year (2022), outstanding pickup and best-performing truck in Nigeria, among others, where both popular brands are competing with Chinese products.

According to the organisers, Nigeria Auto Journalists Association, other stakeholders that have also indicated interest to be part of the prestigious award ceremony are Toyota Nigeria Limited (TNL), CFAO Motors, Dangote Peugeot, Kewalram Nigeria Limitedrarf, Mikano Motors and Lanre Shittu Motors.

RT Briscoe, Elizade Autoland, Jet System, Nord Motors, Autochek, GUO Transport, among others have equally confirmed their participation in the formost auto industry event in the country.

Already, finalists have been shortlisted for the auto awards, with GAC GS4, Geely Coolray and Suzuki S-Presso nominated for the ultimate car-of-the-year award category.

NAJA Auto Awards is an annual event that celebrates auto brands across the entire industry value chain in Nigeria.

According to the awards committee, dozens of distinguished automotive journalists from different mediums selected the finalists based on their evaluation of each eligible vehicle as part of their professional work.

In the Truck-of-the-Year category, the contest will involve Sinotruk by Dangote, Shacman truck by TSS and JAC truck from Lanre Shittu Motors.

Innoson, Mikano and GAC will slug it out in the Assembly Plant-of-the-Year category.

In the luxury car segment, Porsche, Mercedes and BMW models are the front runners.

Elizade Autoland (JAC), Stallion Hyundai and CFAO Motors will battle for the outstanding auto workshop honour.

In the SUV category (compact), Kia Selto, Geely Coolray and GAC GS4 have been nominated.

For Large SUV, Toyota Land Cruiser will lock horns with GAC GS8, BMW X7 and Range Rover (Autobiography).

Toyota Hilux, Mitsubishi L200 and Ford Ranger will battle for the Best Pickup award.

Lanre Shittu (JAC truck), TSS (Shacman) and Dangote Sinotruk will also battle again for the truck plant of the year award.

Giving insights into the nominees, Chairman of the 2022 Award Committee, Rasheed Bisiriyu, said all vehicles nominated in the various categories represent exceptional value and designs.

“We are using our respected, trusted platform to recognise and acknowledge best-performing brands in different segments and categories across the entire auto value chain.”

According to him, the award event, which has now become a major industry show, celebrates and rewards automotive excellence.

He also disclosed that the Managing Director of RT Briscoe, Mr Seyi Onajide, and Deputy Managing Director of CFAO Motors, Mr Kunle Jaiyesimi, would be honoured with the Auto Personality of the year in recognition of their immense contributions to the development of Nigeria’s auto industry.

In his own comment, Chairman of NAJA, Mike Ochonma, said the auto journalist body has always believed in bringing together all the stakeholders in the automotive sector to build a stronger community and strengthen consumers’ confidence and trust in the industry and their brands.

“I would like to congratulate all the nominees for the 2022 edition and look forward to their presence at the grand ceremony,” he added.

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