The Latest Chip Shortage Forecast Is Horrific News for Carmakers Worldwide

While there are signs that the chip shortage could be over in just a few months, it now looks like the struggle in the automotive industry will probably continue.
Carmakers have been struggling with the constrained chip supply 6 photos
Photo: GM
GM's Flint assembly plantGM's Flint assembly plantGM's Flint assembly plantGM's Flint assembly plantGM's Flint assembly plant
The most recent report coming from Digitimes, which has a good track on scoops from the supply chain, indicates that the constrained semiconductor inventory would remain a problem for carmakers worldwide for a little longer.

In theory, this is precisely what car manufacturers themselves expected, but according to these undisclosed supply chain sources, the semiconductors needed by automakers will continue to be in hot demand until 2024.

In other words, the chip shortage isn’t going to be over before January 2024, so typical problems like huge waiting times for new cars and vehicles shipped without certain non-critical systems will continue to be quite common throughout 2023.

Worth knowing is that this latest forecast is specifically aimed at the automotive market, as otherwise, the chip inventory is expected to improve in most other industry sectors.

For example, the demand for PCs, laptops, tablets, and phones is currently declining, not only because of inflation and the rising costs of materials but also due to saturation. Since the beginning of the pandemic, the sales in these sectors went through the roof, especially as many people across the world started working remotely.

Foundries obviously prioritized their biggest customers, with carmakers often turning to backup plans, such as temporary halts of their production and building cars without certain systems and then moving them to parking lots until the chip supply was replenished.

At this point, however, this latest forecast aligns with some carmakers expected to happen anyway. Both General Motors and Ford previously said that the chip inventory is likely to remain a problem in 2023 as well, with some companies expecting the pre-2020 supply levels to be reached only at some point in 2024.
If you liked the article, please follow us:  Google News icon Google News Youtube Instagram
About the author: Bogdan Popa
Bogdan Popa profile photo

Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
Full profile


Would you like AUTOEVOLUTION to send you notifications?

You will only receive our top stories