Auto supplier Robert Bosch said on Thursday the ongoing COVID-19 crisis and a semiconductor chip shortage will weigh on global automotive production growth in 2021.
Around 85 million vehicles will roll off assembly lines around the world this year, more than the 78 million units produced in 2020 but still below the 92 million cars produced in 2019, the Stuttgart-based car parts supplier said.
Global automotive production hit a high of 98 million units in 2017.
"We are quite positive," Chief Executive Volkmar Denner said, although he added that "we still have a long way to go to catch up".
The supplier said it estimated its sales would grow 4% in 2021 after a drop of more than 6% in 2020.
Bosch said the "bottleneck" in the global semiconductor chip market had "not left Bosch unscathed." US automaker General Motors Co is the latest manufacturer hit by the chip shortage. It said on Wednesday that it will cut production next week.
Stefan Hartung, Bosch's head of mobility solutions, declined to apportion blame for the shortage.
"We all fight together in close cooperation to solve the problem." he said.
Bosch said its concerns for automotive production in 2021 extended beyond the pandemic's lingering impact.
"Political developments such as Brexit and continuing strategic competition between the US and China with its potential for trade restrictions are also negatively impacting global economic development."
Full-year earnings before interest and taxes (EBIT) fell 41% to 1.9 billion euros ($2.28 billion) in 2020 from 3.2 billion euros in 2019, and its EBIT margin contracted to 2.5% from 4.2%.
Revenue fell more than 6% to 71.6 billion euros. Adjusted for currency exchange rates, sales fell 4.4%.
Bosch said it had quickly cut costs and capital expenditure as car plants shuttered last spring to help stem the spread of COVID-19 - the latter by more than 1.1 billion euros - generating record free cash flow of around 5 billion euros.
In 2020 the supplier gained 30 new vehicle electrification projects from carmakers worth 7.5 billion euros and will invest 700 million euros this year on electric vehicle technology, up from 500 million euros in 2020.