The head of premium carmaker Daimler warned that suppliers of automotive parts are struggling to keep up with a rise in demand, putting a strain on the entire car industry. "The supply industry overall is under quite a strain. Everyone is struggling, some successfully, others run into a hiccup," Daimler CEO Dieter Zetsche told Reuters on January 27 on the sidelines of an industry conference.
Output at Daimler's factories has for now not been directly affected, he added. Germany's biggest carmaker, Volkswagen, said that it would halt production at its Wolfsburg headquarters on January 31 for one day due to delivery bottlenecks. Driven by demand in Asia, the car industry is recovering swiftly from one of its worst slumps that saw capacity cuts and the collapse of German automotive parts makers including Edscha, Karmann and Honsel.
While demand for cars in developed markets is stuck in low gear amid fading government subsidies, global automakers have been increasing their focus on emerging economies such as China, now the world's largest auto market, and India.
The Chinese are snatching up cars at such a pace that the city of Beijing has introduced a lottery to limit the number of new cars on its congested roads.
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