Expert Analysis on the Semiconductor Chip Shortage and Its Impact on Carmakers

The semiconductor chip shortage is all over the media in recent days, and the headlines are not exactly reassuring.

  • The New York Times writes: “The Global Chip Shortage Hobbles the Auto Industry.”
  • Barron’s declares: “The Chip Shortage Is Getting Worse at the Worst Possible Time.”
  • The Guardian states: “Global Shortage in Computer Chips ‘Reaches Crisis Point.’”

Triggered by trends related to the COVID-19 pandemic, the semiconductor chip shortage is a complex problem that will not be easily or quickly resolved, and it may have serious long-term repercussions for the global automotive industry.

“Lead times for automotive semiconductor chips are now stretching out 6 to 12 months and, as a result, automobile manufacturers are temporarily closing plants or otherwise reducing production,” according to Teresa Hayes, Vice President of Publishing at The Freedonia Group, a premier industrial research company and division of MarketResearch.com. “Pretty much every global motor vehicle manufacturer has been impacted — with Ford seeing some of the biggest losses.”

In the video below, Hayes offers a quick take on how long this chip shortage will last and why this is such a concern for U.S. automakers.

Want to know more? In a newly released white paper, Hayes goes beyond news headlines to provide a deeper dive into this topic. “Chip Shortage May Change How Cars Are Produced” explains what caused the semiconductor chip shortages, the fragility of current supply chains, and plans for new US semiconductor production. It also discusses how the automotive industry may adapt and shares Freedonia’s latest vehicle production forecasts.

The white paper draws on expertise from Freedonia’s Chief Economist Thomas Bowne and Operations Manger Matthew Role of Freedonia Focus Reports to bring you multiple perspectives from long-time industry experts.

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