Daily Management Review

Semiconductor shortages in automotive industry may affect production in the coming months


CEO of German carmaker Porsche, Oliver Blume, said that the problem with the semiconductor shortage in the automotive industry is very serious because it affects the whole industry.

There is strong demand for semiconductors from consumer electronics manufacturers and car production is recovering faster than previously expected.

The growing shortage of semiconductors and microprocessors in the automotive industry became known earlier this month. The shortage is being caused by a number of reasons, including a rise in demand for microprocessors amid the spread of remote working and an increase in demand for computers and laptops. Meanwhile, in the second half of the year, the car industry began to recover from the downturn more quickly than expected. 

In addition, the chips used in cars - and more are needed as modern technology advances - are often more sophisticated and specialised than those used in smartphones and other similar gadgets. Research firm IHS Markit predicts the chip shortage will cut global production by more than 670,000 cars in the first quarter alone.

Porsche's CEO confirmed the severity of the problem and clarified that it needs to be addressed immediately. "It could affect us any day now, so we are trying to figure out what needs to be done in the coming days or months," said the German top manager, "We need to mitigate the impact of this problem in the short term and find a solution in the longer term".

source: cnbc.com