S.Korea Sept factory output contracts as auto chip shortage bites
Reuters
Published Oct 28, 2021 07:41PM ET
Updated Oct 28, 2021 08:30PM ET
By Joori Roh
SEOUL (Reuters) -South Korea's factory output snapped 10 straight months of year-on-year growth in September, dashing expectations for continued expansion, as global chip shortages hit production.
Industrial production last month fell 1.8% year-on-year, Statistics Korea data showed on Friday, missing forecasts for 1.4% growth and down from a 9.7% expansion in August. On a seasonally adjusted monthly basis, output fell 0.8%, missing a median 0.3% decline forecast and following a 0.7% drop in August.
A breakdown of data showed production of cars shrank 9.8% from a month earlier, while that of semiconductors and electrical equipments also slumped 1.6% and 5.2%, respectively.
"September industrial output was weak as global supply chain disruptions were seen weighing on production in the manufacturing industry and on fewer working days," said Oh Chang-sob, an economist at Hyundai Motor Securities.
The country's biggest carmaker Hyundai Motor Co reported a lower-than-expected profits on Tuesday as the global chip crisis drove down vehicle shipments and said it will take a long time to get back to normal chip supplies.
That comes just weeks after its global chief operating officer said the automaker aims to develop its own chips to reduce reliance on chipmakers.
Separately, Samsung Electronics (OTC:SSNLF) Co Ltd on Thursday said it expects component shortages to affect chip demand in the current quarter, even as it reported the highest quarterly profit in three years.
On an annual basis, production for cars and metal products plunged 24.2% and 16.9%, respectively, offsetting a 30.6% expansion in semiconductors.
Friday's data also showed service sector output expanded 1.3% month-on-month in September, while retail sales jumped 2.5%, helped by the easing of COVID-19 restrictions at home.
South Korea unveiled on Monday a three-phase scheme to scrap all limits on distancing curbs gone by February, except for mask-wearing mandates.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.