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Automakers across the globe are in the midst of a resource shortage it hasn't seen for generations. It seemed global car brands were at least treading water while attempting to bring a solution to the chip shortage. But the recent news that China, the world's biggest supplier of magnesium metal, was going to cut production substantially was feared to bring a killing blow that sends the auto industry crumbling.
China produces nearly 90% of the global magnesium supply, with other outliers like Israel, Russia, and the United States making up most of the rest. Magnesium can be fused with aluminum to form remarkably light and strong automotive components like bodywork. Leading many to assume any substantial decline in total production would spell doom for most automakers.
But the media representatives within the auto industry are playing a remarkably different tune this week. Both Stellantis Group and BMW have announced they do not expect the latest magnesium shortage to be of significant concern in the short term, but the long term is anyone's guess.
According to Reuters, some in the sector believe reserve supplies of magnesium are likely to last at least some of the way through 2022. Allowing for the rollout of new 2022 models without issues, at least with metal supply. Whether microchip supplies will allow for this or not remains to be seen.
Currently, the estimated total magnesium output from China is around 50% of its normal capacity, not quite global crisis levels of shortage. But with international coal prices also skyrocketing, there's no guarantee that figure can be maintained, leaving doubts about whether the industry can brave the storm.
Meanwhile, the team at Volkswagen has been more somber with its reports on the matter. The company's representatives remarked that current predictions can't determine whether or not the global shortage of Chinese magnesium will create a shortage as impactful as the microchip shortage. With other German companies like ZF Transmissions already seeking alternate suppliers, the situation is still dicey as can be.
But the media representatives within the auto industry are playing a remarkably different tune this week. Both Stellantis Group and BMW have announced they do not expect the latest magnesium shortage to be of significant concern in the short term, but the long term is anyone's guess.
According to Reuters, some in the sector believe reserve supplies of magnesium are likely to last at least some of the way through 2022. Allowing for the rollout of new 2022 models without issues, at least with metal supply. Whether microchip supplies will allow for this or not remains to be seen.
Currently, the estimated total magnesium output from China is around 50% of its normal capacity, not quite global crisis levels of shortage. But with international coal prices also skyrocketing, there's no guarantee that figure can be maintained, leaving doubts about whether the industry can brave the storm.
Meanwhile, the team at Volkswagen has been more somber with its reports on the matter. The company's representatives remarked that current predictions can't determine whether or not the global shortage of Chinese magnesium will create a shortage as impactful as the microchip shortage. With other German companies like ZF Transmissions already seeking alternate suppliers, the situation is still dicey as can be.
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