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Desperate Times: Companies Buy Washing Machines Just to Rip Out the Chips

They say desperate times call for desperate measures, and in terms of the ongoing chip crunch, it looks like this idiom makes perfect sense.
Carmakers have been hit really hard by the lack of semiconductors 6 photos
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ASML is currently one of the biggest (if not really the biggest) companies that build lithography machines used for the fabrication of chips. In plain English, ASML makes critical equipment used for the manufacturing of semiconductors, so it goes without saying it’s one of the giants that are closely monitoring the evolution of the crisis.

And according to CEO Peter Wennink, things aren’t by any means looking good.

In his company’s earnings call earlier this week, Wennink revealed something that many people believed was a joke: some firms out there are buying washing machines just to rip out the chips and then use them for industrial modules.

In other words, the chip shortage has become so destructive that some of the most affected companies buy other products, tear them apart, extract the chips, and then use them for their own applications.

It happens everywhere,” Wennink explained without actually naming the companies that have turned to such extreme workarounds to deal with the semiconductor crisis.

As far as the car market is concerned, everybody knows the super-constrained chip inventory has wreaked havoc pretty much all over the world. Most companies had no other option than to temporarily suspend the production or sell their vehicles without non-critical systems, all in an attempt to reduce the number of chips used on the models they were building.

There are signs that the global chip inventory could improve by the end of the year, not necessarily because chipmakers have managed to boost the production overnight but due to the demand for some products slowing down.

Some carmakers, however, including Volkswagen and BMW, don’t expect full recovery to pre-2020 levels anytime soon, with some anticipating the struggle would continue until 2024.

 
 
 
 
 

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