Shortage of chips that plagues industry in general and particularly auto manufacturers has been given a lot of media time. The timing of the crisis was unfortunate, since this year was to be the year of recovery after pandemic. On the positive side, the demand is far surpassing the forecasts, but disruptions to the suppliers is also amplified by an apparent labor shortage. Some analysts claim that this crisis is an indication of the shift in manufacturing overseas, but the data does not support this point.
Key Takeaways:
- Even though the auto industry experienced a slow down due to the pandemic, the demand for new vehicles is now strong.
- In 2020, the auto industry slashed their chip purchases, contributing to the overall slowdown in production.
- As the auto industry shifts toward electric and autonomous vehicles, the need for electronic components is increasing.
“I believe car manufacturers are going to have to think and behave more like high-tech companies in both product design and supply chain management.”
