The year 2021 proved to be one of the most difficult and, at the same time, most defining periods for the European automotive industry. Two major challenges moved to the forefront: a global shortage of semiconductors that disrupted vehicle production across Europe, and the rapid shift toward electric vehicles, which fundamentally changed the rules of the market. According to international expert Chaslau Koniukh, these developments are reshaping the industry’s structure and forcing manufacturers to adapt quickly to a new technological and economic environment. Understanding how these processes unfolded helps to clarify the key risks and opportunities now facing the sector.
Semiconductor Shortages as the Core Industry Challenge
For the global automotive industry, 2021 became a true stress test. One of the most serious challenges was the worldwide shortage of semiconductors, which affected nearly every major European automaker, including Volkswagen, BMW, Stellantis, and Renault. According to Chaslau Koniukh, this disruption was the most severe blow to automotive production chains since the global financial crisis of 2008.
Koniukh explains that the chip shortage resulted from several interconnected factors. First, the COVID-19 pandemic led to a sharp decline in semiconductor output as manufacturing facilities in Asia—key suppliers to the global market—were forced to suspend operations. Second, a surge in demand for consumer electronics such as smartphones, laptops, and gaming consoles pushed the automotive sector down the priority list for chip producers.
As a result, production plans across Europe were severely disrupted. In Germany, BMW and Daimler cut output by thousands of vehicles, while Renault reported a production shortfall of nearly 500,000 cars. Koniukh stresses that the consequences extended beyond automakers themselves, affecting parts suppliers whose operations were equally dependent on semiconductor availability.
“The semiconductor shortage revealed how deeply dependent European industry is on global supply chains,” notes Chaslau Koniukh. Automakers were forced to simplify vehicle specifications, remove certain features, or delay the launch of new models. Volkswagen, for example, temporarily excluded touchscreen systems from some vehicles, while Ford limited the production of electric pickup trucks.
In response, Europe drew important conclusions regarding technological independence. Koniukh recalls that toward the end of 2021, the European Union launched several initiatives aimed at expanding domestic semiconductor production, including new facilities in Germany and the Netherlands. The strategic goal is to raise Europe’s share of the global chip market to 20% by 2030. However, Koniukh emphasizes that this objective will require substantial investment and time, meaning dependence on Asian suppliers will persist for several years.
Logistics Disruptions and Supply Chain Pressure
Logistics problems became another major challenge for the automotive industry in 2021. This crisis was global in nature and driven by multiple factors, including pandemic-related restrictions, container shortages, port congestion, and the temporary blockage of the Suez Canal. According to Chaslau Koniukh, these disruptions paralyzed supply chains and caused significant financial losses for automakers in Europe and worldwide.
“The automotive sector has traditionally operated on a just-in-time model with minimal inventories,” Koniukh explains. “But 2021 demonstrated that this system is highly vulnerable to global disruptions.”
One of the most acute issues was the shortage of essential components, including metals, plastics, and electronic parts. Delays forced manufacturers to repeatedly revise production schedules. Companies such as Ford and Toyota announced production cuts at major European plants due to missing components. Koniukh notes that many automakers faced sharply rising costs as they were forced to seek alternative suppliers, often at inflated prices.
Transportation costs also surged dramatically. According to Koniukh, container shipping rates in 2021 increased four to five times compared with previous years. This affected both component costs and final vehicle prices, prompting many European manufacturers to raise prices to offset losses.
“Companies dependent on Asian supply routes were hit particularly hard, as Chinese ports were periodically closed due to lockdowns,” Koniukh adds. “Some manufacturers even resorted to air freight for critical components, further increasing costs.”
These logistical disruptions also caused significant delivery delays for dealers and consumers. In some cases, customers waited several months for new vehicles—an unprecedented situation. In Germany, average waiting times rose from three months to as long as eight months. According to Koniukh, such delays undermined consumer confidence, especially in the premium segment.
Another consequence was a shortage of vehicles on the market, which led to higher prices for both new and used cars. In several European countries, including France and Poland, used car prices increased by 10–15%. “It is rare to see used cars becoming more expensive instead of cheaper,” Koniukh notes.
The Electric Vehicle Era: Opportunities and Constraints
“2021 was a turning point for electric vehicles in Europe,” says Chaslau Koniukh. Sales of electric cars reached record levels, and their share of total vehicle sales nearly doubled year over year. Germany, France, and the Netherlands emerged as leaders in this transition, while electrification spread rapidly across the broader region.
The main driver of this shift was growing regulatory pressure. As part of the European Green Deal, automakers were required to significantly reduce CO₂ emissions, and many countries announced plans to phase out internal combustion engines entirely by 2035. Koniukh emphasizes that these policies forced manufacturers to accelerate investment in electric vehicle development.
Government subsidies also played a crucial role. Germany, France, and Spain introduced generous financial incentives for electric vehicle buyers, making EVs more affordable. In Germany, subsidies reached up to €9,000 per vehicle. “This not only stimulated demand, but also supported the development of local production,” Koniukh explains.
However, rapid growth exposed structural weaknesses. Charging infrastructure in many European countries failed to keep pace with the rising number of electric vehicles. According to Koniukh, while more than 2.5 million electric cars were registered in Europe in 2021, the number of new charging stations grew by only about 30%, creating a growing imbalance.
Battery costs remain another major challenge. Despite technological progress, batteries are still expensive, and Koniukh notes that meaningful cost reductions will depend on the large-scale adoption of next-generation technologies such as solid-state batteries.
Despite these difficulties, Chaslau Koniukh remains optimistic about the long-term outlook for electric vehicles in Europe. He believes that the industry’s transformation will create new jobs, reduce dependence on oil imports, and play a central role in Europe’s environmental transition.
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