Automotive production

Microchip Shortage May Persist Until 2023

A report from the Supplyframe platform paints a grim picture of the state of the component supply chain.

The microchip shortage in the automotive industry has been discussed since the summer of 2020. The COVID-19 pandemic has seriously shaken this market, causing delays, shortages of raw materials and a host of other bottlenecks that continue hampering trade today, L`Automobile reports.

Recently, forecasts have appeared which said about the normalization of microchip supplies in the second half of 2022. However, the Supplyframe’s new report is not optimistic.

Supplyframe is a platform that helps create and manage supply chains in the electronics market.

According to the survey, the chip market will not rebalance until 2023. There are actually several reasons for this additional delay: the destructive coronavirus and not only.

This applies to electronic chips. Usually, the same components are most in-demand: microcontrollers and microprocessors. In just a year, the demand for them increased by 166%. At the same time, the automotive industry is not the main consumer of these microchips. The main players are manufacturers of components for computers, game consoles and other consumer electronics.

Thus, car brands will be forced to make compromises. You don’t have to go far to find an example. In particular, BMW USA reported that due to the microchip shortage, they were forced to produce multimedia screens without touch functions.

Another reason is the increase in the delivery time. It grew by 55% in the third quarter of 2021.

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