Shortage

A Year of Poor Planning Led to Carmakers’ Massive Chip Shortage

(Bloomberg) — Near-sighted planning, supply-chain complexities and a tradition of keeping inventories low caused the semiconductor shortage that is now forcing carmakers to idle production lines and straining their relationship with chip manufacturers.

Seeds of the imbroglio were sown almost a year ago as the virus outbreak led to plunging car demand, prompting auto-chip companies to slash orders. But when they wanted to increase supply toward the end of 2020, they struggled to secure capacity at Taiwan Semiconductor Manufacturing Co. and other contract chipmakers that were busy servicing a boom in demand for gadgets that help housebound consumers stay connected, according to people familiar with the situation.

While publicly assuring the problem is solvable, in private the parties are pointing fingers. Chipmakers say car companies’ preference for low inventories hurt their planning, while auto and part manufacturers say the supply chain is thrown into disarray as semiconductor makers drag their

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The Semiconductor Shortage Has Come for the Auto Industry

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The ongoing semiconductor shortage isn’t just hitting big-name tech companies like AMD, Intel, and Nvidia. According to multiple automotive manufacturers, the general manufacturing problems hitting the industry are now meaningfully slowing vehicle production.

“This is absolutely an industry issue,” Toyota spokesman Scott Vazin told the AP. “We are evaluating the supply constraint of semiconductors and developing countermeasures to minimize the impact to production.”

This is separate from the COVID-related issues that caused car manufacturers to idle facilities throughout 2020, and it’s creating constraints on companies as they attempt to bring factories back online. Toyota has slowed production on the Tundra, Ford pulled in some planned downtime for its Louisville facility, Fiat Chrysler has temporarily closed some factories, and Volkswagen has announced it’s facing component shortages and may slow production for this reason. Nissan hasn’t

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