Cnh Industrial, temporary closure of production sites in Europe: the lack of chips weighs
CNH Industrial will temporarily close several of its production sites for agricultural machinery, commercial vehicles and propulsion systems in Europe, due to supply chain disruptions and a shortage of key components, especially semiconductors. The company, the note reads, “is constantly reviewing its production plans to respond to this highly volatile environment and plans to close the affected plants for no more than eight working days in October.” Furthermore, Cnh Industrial “remains constantly committed to optimizing production operations in order to respond to the continuing strong demand and better serve its dealers and customers “.
Meanwhile in Piazza Affari the title of Cnh Industrial remains weak, ranking among the worst in the Ftse Mib. “Not specifying which plants are involved we cannot identify which division is most affected (imagine Iveco commercial vehicles which generate over 80% of turnover in Europe) “, they comment Equita analysts in a note. At group level, Europe in 2020 accounted for 49% of revenues.
“In any case, the analysts add, the news does not surprise us after the Traton warning last month and the series of negative news from auto and auto parts manufacturers “. As well as for the auto sector” the short-term performance will be penalized by lower volumes (although we believe on a smaller scale reduced), but this does not compromise the equity story in light of the positive trend of the main reference markets as the demand from end customers remains strong“, concludes Equita, who has a buy opinion on the stock with a target price of 18.5 euros.