Page 25 - CE Outlook Regions 2022

2.1.4 Industrial production
The persisting problems in global production and supply chains
remained a severe constraint on the global economy, which are
being felt particularly strongly in the highly industrialised Czechia,
especially in the automotive sector. In the autumn of 2021, the
biggest Czech car producer Skoda Auto was producing at about
75% of its capacity.

The very open Czech economy, with a high share of car production,
is highly vulnerable in this respect. The industry has been going
through significant monthly fluctuations since the end of
anti-epidemic measures in the spring of 2021.

The forecasts assume that a sharp growth in shortages of some
materials and components, due to demand spilling over significantly
from services to goods as well as due to major problems in global
transport, will limit Czech economic performance until mid-2022.
Industrial shutdowns, component shortages and growth in
inventories due to unfinished production will be reflected in falling
exports.

KB does not expect a full resumption of deliveries until the
mid-2022. During 1H22, only a small improvement in the supply
chain situation is expected and the complete disappearance of these
problems only in the 2H22.

According to a forecast by FocusEconomics, industrial production
should expand 5.2% in 2022, followed by an industrial production
increase of 4.1% in 2023.

According to Trading Economics, global macro models and analysts
expectations, Czech manufacturing PMI is expected to stand at
56.00 points by the end of 4Q21, followed by a drop to 53.50 points
in 2022 and 52.10 points in 2023.

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