Chip shortage problem is increasingly likely to last a full year, the auto manufacturing industry will be hit hard.
Global semiconductor supply shortage, initially downplayed as a temporary problem, but Japan’s semiconductor maker Renesas Electronics fire, Taiwan and the drought, now it seems that the chip shortage problem is increasingly likely to last a full year, the auto manufacturing industry will be hit hard.
AFP reported that the car manufacturers are planning to accelerate production this year, because consumer demand is expected to slow down with the epidemic and a big increase, but also want to make up for last year’s losses. But the chip shortage, so this hope is increasingly dim.
Global chip shortage of automotive production lines forced to idle
Chip shortage has forced car manufacturers in the material exhaustion, let the production line idle for a short time.
Factories including Toyota, Volkswagen, Ford, Peugeot, Fiat, Jeep, Honda, Jaguar Land Rover and even Chinese start-up Nio have had to suspend production in the past few months.
In recent years, automakers have been reducing their inventories of parts on hand to save costs, so any delays in supply will soon force a complete plant shutdown.
Renault CEO Luca de Meo told shareholders this past week, “The semiconductor shortage could bring down production by at least 100,000 units this year.”
In Germany, as Fuchs and Mercedes-Benz (Mercedes-Benz) were forced to suspend production, thousands of auto industry workers faced shortened hours or temporary unemployment.
In addition, Fiat’s plant in Brazil’s Bejing (Betim) slowed production for the second time this month. Stellantis company (Stellantis) in France, Rennes-La Janais (Rennes-La Janais) has 2,000 employees in the factory is also close to shutdown.
Why are automotive chips important? Why the shortage?
Computer processors are an important component of modern vehicles, and there may be dozens of processors in the car to control the engine, automatic braking system, airbags, automatic parking system, infotainment system and other equipment.
Major processor manufacturers such as Taiwan’s TSMC, South Korea’s Samsung (Samsung) and SK Hynix (SK Hynix) are located in Asia, but there are still some plants in Europe and the United States.
The surge in demand for electronic equipment during the epidemic is the main reason for the shortage of chips today. And in March, Japan’s Renesas Electronics main factory fire helped, and Taiwan is in a drought, which may force a reduction in production.
Can not wait for the chip car manufacturers to learn to improvise
Automakers say they are taking stock of the situation daily and trying to avoid shutting down production lines altogether.
U.S. General Motors (GM) issued a statement saying that because of the chip shortage, “if necessary, GM will build some vehicles that are missing specific modules” and “can finish as soon as more semiconductors are available.
Stellanitis was able to resume production of the new Bausch + Lomb 308 after a three-week shutdown, but at half the usual production rate, and reverted to using an analog speedometer instrument panel.
When the situation will be improved, each said differently
Most automakers said they hope to make up for lost production in the second half of this year. Daimler (Daimler) Chief Executive Officer Kang Lin Song (Ola Kallenius) said in a statement that the current shortage of semiconductor chips slowing global car production “can be made up by the end of this year.
But some people are more pessimistic.
Bosch (Bosch), an important supplier of automotive components, CEO Denner (Volkmar Denner) said: “The situation is not expected to improve in the short term. In the coming months, the whole industry may have to face this unsatisfactory situation.”
French automotive component manufacturer Faurecia does not expect the situation to improve before the end of the year, as the consumer electronics industry prepares for the peak production season.
Faurecia CEO Patrick Koller said, “The third quarter is very important for the production of Christmas merchandise. We can be more optimistic about the fourth quarter.”
The Netherlands International Group (ING) Taiwan economic expert Peng Aiyao (Iris Pang) said that the chip shortage crisis could last until next year, or even 2023. Taiwan’s drought has prompted authorities to order companies in areas where chip factories are located to reduce water use.
She told AFP: “The current situation has started to make semiconductor factories anxious, considering the increase in factory semiconductor orders.”
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