Photo: Stefan Baldauf / SB-Medien
Like the rest of the automotive industry, Renault has been struggling to reduce the disruptions caused by the lack of chips.
And unsurprisingly, its production has been substantially impacted, with the company acknowledging recently that in 2021, it ended up building 500,000 fewer cars simply because it didn’t have enough chips to keep the process going.
Renault CEO Luca de Meo explained that the impact of the shortage would be smaller this year because of the ongoing crisis that the industry is dealing with right now.
Don’t worry, though, de Meo said, as the second half of the year would bring a “normal situation” that will theoretically allow the car production levels to return to pre-2020 levels.
Certainly, that’s a very optimistic prediction, but not everybody seems to believe this is possible.
And it’s all because of a combination of the current health crisis, the unbelievable demand for chips, and other material shortages that the world is trying to deal with.
In other words, despite the investments in capacity, bringing things back to normal in a timely manner is very difficult, if not impossible, especially when 2022 is the target year.
On the other hand, it’s very clear that boosting the capacity is what the entire chipmaking business is trying to do right now.
But if we ask market analysis firm IDC, this isn’t necessarily the best way to go. And it’s all because the massive investments in increased production capacity could push chipmakers to an output that would eventually help resolve the shortage but cause another worrying problem: an oversupply that would still impact the industry.
In plain English, chipmakers could end up building many more semiconductors that customers across the world actually need.
For now, however, opinions on the timing when the chip shortage could be over are still divided, but we can’t but hope Renault and a few others are right on this one.
Renault CEO Luca de Meo explained that the impact of the shortage would be smaller this year because of the ongoing crisis that the industry is dealing with right now.
Don’t worry, though, de Meo said, as the second half of the year would bring a “normal situation” that will theoretically allow the car production levels to return to pre-2020 levels.
Certainly, that’s a very optimistic prediction, but not everybody seems to believe this is possible.
And it’s all because of a combination of the current health crisis, the unbelievable demand for chips, and other material shortages that the world is trying to deal with.
In other words, despite the investments in capacity, bringing things back to normal in a timely manner is very difficult, if not impossible, especially when 2022 is the target year.
On the other hand, it’s very clear that boosting the capacity is what the entire chipmaking business is trying to do right now.
But if we ask market analysis firm IDC, this isn’t necessarily the best way to go. And it’s all because the massive investments in increased production capacity could push chipmakers to an output that would eventually help resolve the shortage but cause another worrying problem: an oversupply that would still impact the industry.
In plain English, chipmakers could end up building many more semiconductors that customers across the world actually need.
For now, however, opinions on the timing when the chip shortage could be over are still divided, but we can’t but hope Renault and a few others are right on this one.
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