World automakers might lose $210 billion in income this 12 months due to provide chain disruptions, practically double a forecast from earlier this 12 months, consulting agency Alixpartners mentioned.

A scarcity of semiconductors is simply a part of the issue, Alixpartners mentioned in a brand new forecast on Thursday.

Excessive costs and tight provides of commodities resembling metal and plastic resin are driving up prices and forcing automakers to curtail manufacturing.

Automakers are on observe to lose manufacturing of seven.7 million automobiles in 2021, in accordance with the brand new forecast.

Alixpartners advises automakers on provide chain and different points.

In Might, the agency predicted that automakers would lose $110 billion in income and fall 3.9 million automobiles wanting manufacturing plans for the 12 months.

The dour new forecast comes amid warnings from automakers and industrial truck producers that semiconductor shortages and commodity value spikes should not easing as 2021 heads into its remaining months, as business executives had hoped they’d.

Final week, IHS Markit slashed its world auto business manufacturing outlook for 2021 and 2022.

Within the U.S. market, automobile gross sales have begun to sluggish as a result of inventories on vendor tons are round 20 days’ provide, lower than half the traditional ranges, mentioned Dan Hearsch, a managing director in Alixpartners auto observe.

“We had initially assumed we might get again to regular and claw again quantity” within the fourth quarter, Hearsch advised Reuters. “That isn’t going to occur.”

As an alternative, automakers might have tight inventories till late 2022 or early 2023, he mentioned.

Provides of semiconductors have been hit up to now few months by COVID-19 lockdowns in Malaysia, which has hobbled manufacturing at necessary suppliers.

It now takes a document 21 weeks to fill chip orders and auto executives say the scarcity might final for years.

“It definitely looks like probably the most protracted provide scarcity the business has seen as a result of it is not over,” Hearsch mentioned. “It is definitely probably the most far-reaching. That is each place. That is everyone.”

Port backlogs

Backlogs at main U.S. ports are hampering efforts by auto producers to import extra plastic resins and metal, Hearsch mentioned.

In response, automakers are committing to longer contracts to lock in provides, shopping for as a lot as 40 to 50 weeks prematurely, Hearsch mentioned. “They’re signing up for issues they’d by no means have performed a 12 months in the past,” he mentioned.

Bloomberg contributed to this report