Japanese automakers are facing supply shocks, as the conflict with Iran has cut off key aluminum supplies from the Middle East, with about 70% of aluminum imports coming from this region, posing significant risks to companies like Toyota and Denso. Since the escalation of the conflict at the end of February, aluminum prices have risen by about 13%, increasing the cost pressure on components. Denso has already reduced production, and smaller manufacturers are also adjusting. Kato Light Metal Industry Co. has stopped deliveries in the Middle East, and its inventory may last until May, preparing to purchase from Southeast Asia. If the situation does not improve, more widespread disruptions may occur at the end of April or the beginning of May. The supply outlook is uncertain; even if the conflict de-escalates, supplies may still be tight, potentially leading to temporary shutdowns and production adjustments. The rise in aluminum prices and supply chain disruptions will indirectly push up the logistics and operational costs of e-commerce platforms for automobiles and components.

Source: Sina Finance