Volvo has joined Tesla in stopping its EV production in Europe due to the threat of violence from Iran-backed Houthi fighters attacking commercial ships traveling in the Red Sea.
As City Dwellers reported yesterday, Tesla has halted its Berlin gigafactory for about two weeks, from January 29 to February 11, due to a lack of components as a result of a Red Sea blockade.
Tesla and Volvo are among several companies having to direct ships away from the Red Sea amid the threat of attacks, Automotive News Europe reports.
Volvo said it would halt production at its factory in Ghent, Belgium, for three days after rerouting ships to avoid potential violence. That has delayed the delivery of gearboxes, a Volvo spokesperson told Automotive News Europe. The Ghent factory currently builds its fully electric XC40 and C40, with the EX30 EV added next year. Production and deliveries coming from its other European plant in Gothenburg, Sweden, are not affected.
What’s happening is that Iran-backed Houthis have declared a blockade on the Bab al-Mandeb strait, near Yemen, in response to Israel’s attacks on Gaza – it’s a tiny chokehold to the Red Sea and a control point of all shipping between the Indian Ocean and the Mediterranean Sea via the Suez Canal. The group has stated its intentions to attack any commercial ships traveling through the strait into the Red Sea.
Since October, the group has attacked several commercial vessels with drones and ballistic missiles and seized what they said was an Israeli cargo ship, reports the BBC. Attacks in the Red Sea have jumped 500% in the past month, with now companies taking extreme measures to avoid risk.
Global shipping companies, in one of the world’s busiest shipping lanes, have had to redirect or halt shipping altogether. Turning ships south to travel around Africa takes much longer than cutting through the Suez Canal. Rerouting adds 10 days and $1 million in fuel costs to a journey from Asia to Europe, Reuters reports.
Volvo has said that it doesn’t see the disruption impacting its production targets and that it doesn’t expect to see “significant” restrictions due to the Red Sea blockade.
Meanwhile, tensions are escalating with US and UK airstrikes on Houthi targets in Yemen, Reuters reports.
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