Semiconductor shortage to cost carmakers $110bn in 2021
The current global shortage of semiconductors is on track to cost the world’s automakers $110bn in revenue this year, almost twice previous estimates.
Consultants at Alix Partners said that 3.9m fewer vehicles would be manufactured in 2021 as a result of the shortfall, weighing on car firms’ earnings.
One by one the world’s car giants have come out to warn that the shortage, caused by a surge in demand for the chips, would hit their production plans.
This morning Honda said that its growth in 2021 would be hindered by the lack of the components, which are central to modern car design.
And Mazda said it would make 100,000 fewer cars this year as a result of the crunch.
In late January, Alix Partners estimated the combined losses for the year at $61bn, but with the situation worsening the firm has now upped its forecasts.
Several prominent chipmakers have warned that the shortage could extend into 2022.
The average car contains 1,400 of the chips, but this figure can be three times higher for electric vehicles.
Alix Partners managing director Andrew Bergbaum said: “The pandemic-induced chip crisis has been exacerbated by events that are normally just bumps in the road for the auto industry, such as a fire in a key chip-making fabrication plant, severe weather in Texas, and a drought in Taiwan.
“There are up to 1,400 chips in a typical vehicle today, and that number is only going to increase as the industry continues its march toward electric vehicles, ever-more connected vehicles and, eventually, autonomous vehicles. So, this really is a critical issue for the industry.”
Governments and businesses around the world are taking steps to arrest the crisis, with Reuters today reporting that a bipartisan group of US senators would bring forward a bill proposing $52bn of spending to tackle the issue.