When Will The Global Car Chip Shortage End?< Back to blog
The semiconductor chip shortage caused by the coronavirus pandemic is very unlikely to end in 2021 and most manufacturers have been hit. Already millions of vehicles have been delayed as a result, leading many people to turn towards in-stock cars.
What caused the chip shortage in the first place? And how important are these components to vehicles? Discover everything you need to know about the global semiconductor chip shortage in this blog.
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What are semiconductor chips?
All electronic devices use microchips as part of their system of circuits. Mobile phones, games consoles and computers, for example. Cars also fall under this bracket, where they’re needed for important elements such as the infotainment system, parking cameras and other onboard electrics.
Because they’re so crucial to a modern car’s functionality, without them manufacturers have to halt production of their models. These microchips aren’t simple to make either – they require dedicated factories that have high levels of cleanliness and a lack of static electricity.
Ford in particular has been hit by the shortage, with production of its popular F-150 pickup paused for two weeks. Mini had to shut its Oxford Plant because of a lack of microchips, while Stilantis (that owns Fiat, Peugeot, Citroen, Chrysler and Vauxhall, to name a few) has probably been the hit the hardest, having to slow down production in eight of its global factories.
Why is there a microchip shortage in 2021?
The demand for semiconductor microchips in a variety of electronic devices, plus the impact Covid-19 has had on factory productions, has meant that there’s a backlog of orders for them.
These microchips take a long time to produce even in normal conditions, and a slight delay can prove catastrophic. So, it’s no surprise that in the current climate there’s been a sudden drastic shortage.
When the pandemic hit and less people were in the market for a car, orders for the microchips suddenly stopped. Meanwhile, tech firms were purchasing plenty of microchips to cope with the demand for devices such as the new PlayStation 5, which have always been renowned for their popularity.
As carmakers began to restart production following the easing of coronavirus restrictions, they found themselves at the back of the queue for microchips.
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