EPCA ’22: European auto output will only recover to pre-pandemic levels in 2025 – analyst
BERLIN (ICIS)–Production from the European petrochemicals-intensive automotive sector is unlikely to recover to pre-pandemic levels until 2025 at the earliest, a chemicals analyst at the Boston Consulting Group (BCG) said on Tuesday.
Andreas Gocke, global lead for chemicals at BCG, said the war in Ukraine and supply-chain issues have only seen a further deterioration in the outlook for the automotive sector, which was already negative in 2021.
Gocke was speaking to delegates at the European Petrochemicals Association (EPCA) annual meeting at a session titled ‘Competitiveness of the European Chemical Industry’.
Around 20% of European petrochemicals output is sold to the automotive sector, and a a slowdown such as the one forecast by BCG has major implications for the industry.
“The number of produced cars has gone down by 28% from the beginning of 2020 and that is very important for chemicals as a key supplier to the industry. This is not the consequence of inflation or the war in Ukraine – this was driven by previous factors [already taking place in 2021],” said Gocke.
“The forecasts [for automotive] continue to be corrected again and again. Planning scenarios become even more difficult for you [petrochemicals companies]. This is even more radical for Europe.
The automotive industry is a major global consumer of petrochemical-based materials, which account for more than one-third of the raw material costs of an average vehicle.
A typical vehicle contains a wide variety of chemicals, including polypropylene (PP), along with nylon, polystyrene (PS), styrene butadiene rubber (SBR), polyurethanes (PUs) and methyl methacrylate (MMA)/polymethyl methacrylate (PMMA), among others.
The EPCA annual meeting runs on 4-6 October in Berlin.
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