Russia restricts the supply of inert gases – what does this mean for the car industry?

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According to the decree of the Government of the Russian Federation, the export of inert gases from Russia is limited until the end of this year. The list includes all inert gases – in particular neon (30% of world consumption is supplied by Russia), argon, helium and others. They are used in the production of semiconductors from which microcircuits are made. A number of experts believe the government’s decision is sensitive to countries that have imposed sanctions on Russia.

Essentially, the decision means that Russia will only supply inert gases to foreign markets in exchange for microelectronics, Izvestia writes. The semiconductor crisis started a year ago and was exacerbated by the events in February. How will the restriction imposed by Russia affect the automotive industry?

Expert opinion

Nikita Gudkov, Deputy editor of the magazine “Behind the wheel”:

– Problems in the production of semiconductors can lead not only to export restrictions from the Russian Federation, but also to the cessation of Ukrainian supplies. According to some reports, Ukraine supplied up to 90% of the neon for the United States, and neon is needed for lasers that make microcircuits. However, about half of the global supply of inert gases comes from China, and this share has been increasing since 2015. The production of these substances is not particularly difficult, the by-products of metallurgy are used as raw materials – and experts say that if desired, it can be mastered quite quickly. Obviously, it will initially be a new “contribution” to the treasury of common problems with the supply of automotive electronic components. But it is not certain that such sanctions will work for long.

As for inert gases, I would suggest that the government pays attention to another problem. Car air conditioners use freon R134a, which, according to market participants, is not produced in Russia. But last year, for some reason, we introduced a licensing procedure for the import and export of such refrigerants, and their price has increased five times. To completely fill the air conditioning system today will cost 3-4 thousand rubles – plus a thousand or two for work! There probably won’t be an obvious shortage of R134a – it’s also shipped from China. But it’s clearly worth using import substitution here.

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