The impact of rising raw material prices on the motor industry

May 31 06:30 2021

The backdrop to rising commodity prices

Global loose monetary liquidity.In order to further rescue the market, most countries in Europe and the United States adopted economic stimulus plans, easy monetary liquidity contributed to the rise of this round of commodities

Supply side tightening.The outbreak has damaged copper production in Chile, the world’s largest copper producer, and reduced output by Vale, the world’s largest iron ore supplier, adding fuel to a rally in global copper and iron ore prices

The epidemic control results are promising.Since the second half of last year, China’s economy has been the first to recover and the global epidemic has gradually improved.Rising expectations of a global economic recovery have boosted demand for commodities this year as countries aggressively buy vaccines and the pace of vaccination has accelerated

In the context of carbon peak and carbon neutral, copper, aluminum and steel production capacity will be further reduced, coupled with the accelerated pace of domestic manufacturing recovery and strong demand, metal raw material prices will maintain an upward trend this year.


The rise in raw material prices has a great impact on traditional asset-heavy and labor-intensive manufacturing industries such as home appliances, textiles and machinery manufacturing, while high-end manufacturing enterprises with high added value are not affected much.According to the analysis, the leading enterprises and large enterprises in the industry have abundant capital flow and strong anti-risk ability. They can hedge against the rising price of raw materials by extending the industrial chain, buying futures, hoarding raw materials, following the price rise and other ways, and even become the beneficiaries of raw material prices.Small and micro enterprises engaged in processing, finished products and other links are directly affected by the price rise of raw materials, mainly reflected in profit compression, or even “the more open the more losses”. If the rising trend of raw materials prices continues, there may be a number of enterprises shut down or go bankrupt

Under the “price surge”, the impact is not limited to the enterprise end, but also may cause inflation risk, affecting the end consumption.Rising prices for raw materials will surely gradually be passed down the river and will likely spill over into consumer sectors such as household goods and spark inflation in the future.

ZHEJIANG GOGOGO MECHANICAL&ELECTRICAL CO., LTD, as an experienced manufacturer and supplier of motors,water pumps and other derivative products.

GOGOGO  have been in the three-phase electric motor, single phase capacitor start motor, Centrifugal Pipeline water pump,  and  Submersible Sewage Pump industry for more than 20 years, serving hundreds of customers and understanding the needs of different customers.Understand the various features of the products.In the process of work, he has encountered a variety of customers, some customers only need a single product.Some customers need a wide variety of products.To meet different special needs, GOGOGO  have begun to offer a wide variety of products.This can help customers save a lot of time,purchasing cost and effort.All what GOGOGO  have done has greatly improved customer satisfaction.And at the same time, customers have introduced more and more customers to GOGOGO because they are satisfied with GOGOGO  products and services.


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