The fall-out from Russia's attack on Ukraine will have significant consequences in the automotive supply chain leading to further price rises and possible availability problems. Already struggling to recover from the problems of Covid and a global logistics crisis, both car makers and parts manufacturers are bracing themselves for more difficulties. 

The price of aluminium, which is increasingly used in vehicles production, has already reached a record high and has nickel reached its highest price for a decade. 

Sanctions put in place by the E.U. and US are likely to limit aluminium supplies from Russia which is currently a major supplier to the European car and components sectors. The sanctions will also mean further energy price rises as Russian oil and gas supply becomes more limited. 

Of particular concern could be the supply of the precious metal, palladium, which is used in catalytic converters. Car makers are responsible for 80% of global palladium use and over 45% of this currently comes from Russia. 

The developments are likely to further push up the cost of vehicle manufacture and mean that car makers further concentrate on premium vehicle models which are more profitable for them. This is leading to a shortage in supply of new small and family sized vehicles, with its subsequent impact on the used car sector.