Europe car sales to lag in first half of 2022 due to chip crisis

European car sales won’t recover to pre-crisis levels this year as chip shortages continue to roil production in the first half, the continent’s biggest car association said. 

New-car registrations in the European Union will likely rise by 7.9% to 10.5 million units, the European Automobile Manufacturers’ Association said in forecasts published on Tuesday. While that would end two years of declines, it would still leave sales almost 20% below their pre-crisis peak, the ACEA said.

European car sales were at their lowest last year since records began in the early 1990s, largely due to chip-related production outages at factories. Carmakers expect to have difficulty sourcing the components until efforts to increase production kick in during the second half of the year.

The ACEA only issued forecasts for EU sales which don’t include figures from the U.K. and the European Free Trade Association countries.