Microchips are the alleged culprit behind all the new vehicle shortages the car market has experienced, culprit because the truth is nobody really knows for sure, the shutdowns in the Auto industry have worked all too conveniently well for dealers and their car makers. Recalling back to 2020, rumor has it that automakers cut back on semiconductor orders severely in the beginning of the 2019 Pandemic in early 2020. Check out charts below with update of automotive Chip shortage update 2023-2024.
Apparently, they were fearful of being stuck with excess inventories of cars, if demand fell significantly due to the pandemic. If that was an actual mistake automaker majorly screwed up on that prognostication, the economy bounced back much quicker than expected after the initial shock from the pandemic.
When automakers tried to increase their orders, they had apparently lost their place in line and were put behind other Industries such as PCS and smartphones with so many people home during lockdowns sales for PCs and other devices had exploded. Computer chips happen to be easier to make they don’t have to be durable against extreme weather like vehicle semiconductor chips do and they have better profit margins, so automakers have been playing catch-up and facing chip shortages ever since.
According to the world semiconductor trade statistics, the top 10 Automotive chip suppliers accounted for 46 percent of the total market of 69 billion dollars in 2021. Bill Jewell consultant with semiconductor intelligence said shortages of Automotive semiconductors will likely remain through at least the year 2023. European-traded Infineon Technologies of Germany was the top supplier with 8.3 percent market share last year, NXP was second with an eight percent market share followed by Japanese-traded Renaissance Electronics at 6.1 percent and Texas Instruments at 5.6 percent.
Semiconductor Chip shortage update 2023
Capacity at semiconductor fabrication plants such as the Robert Bosch plant in Dresden Germany is expected to increase the supply of microchips but whether it can do enough to meet demand is still unclear. Right now, shortages are still forcing more car production Cuts in 2023. Many industry experts have opined that the microchip shortage is coming to an end but that’s clearly up in the air because several automakers are already beginning to alter production plans for 2023, because of the microchip shortage and the industry as a whole is bracing for Millions more in Lost Vehicles next year.
On top of the 10 and a half million lost in 2021, in the 3.6 million lost so far this year. Fioriani admits that slowly more chips are being filtered into the Auto industry, but he also added when we see production of high margin Vehicles still being affected, we know that the answers still aren’t here and we’re still seeing it. Not every automaker agrees that chips are still a factor BMW and Mercedes-Benz for example currently report no significant supply issues related to Automotive chips.
Phil Amsrud senior principal analyst for the automotive semiconductor research area at S&P Global Mobility, says
“Chip makers are pouring billions of dollars into new semiconductor products worldwide, but it will take time to come online.”
When will the auto chip shortage end?
The end of the semiconductor shortage Fiorani admits that slowly more chips are being filtered into the Auto industry, but he also added when we see production of high margin Vehicles still being affected, we know that the answers still aren’t here and we’re still seeing it. Not every automaker agrees that chips are still a factor BMW and Mercedes-Benz for example currently report no significant supply issues related to Automotive chips.is in sight.
Automakers have generally allocated more semiconductors to higher-margin and more expensive vehicles at the expense of the lower-cost models. The industry’s current approach is certainly taking a bunch of buyers out of the loop yeah having a good selection of vehicles under 30 000 would make them much more affordable and bring a lot of buyers back in and potentially stir the industry and the economy.
Manufacturers have quite clearly priced many people right out of the car market. According to the world semiconductor trade statistics, the top 10 Automotive chip suppliers accounted for 46 percent of the total market of 69 billion dollars in 2021. Bill Jewell consultant with semiconductor intelligence said shortages of Automotive semiconductors will likely remain through at least the year 2023.
European-traded Infineon Technologies of Germany was the top supplier with 8.3 percent market share last year, NXP was second with eight percent market share followed by Japanese-traded Renaissance Electronics at 6.1 percent and Texas Instruments at 5.6 percent.
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