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Automotive semiconductor market still all over the place

Semiconductor chip shortage wreaking havoc in the auto industry, with chip makers unable to keep up with surging demand from automakers.

Automotive semiconductor market still all over the place
Published Sep 24, 2022 7:09 PM CDT   |   Updated Sun, Oct 16 2022 10:30 PM CDT
1 minute & 23 seconds read time

The automotive industry is still working through a semiconductor shortage that has caused major headaches for carmakers. Strong demand persists despite the chip shortage starting in 2020 and will likely continue throughout the rest of this year and into 2023, analysts predict.

Automotive semiconductor market still all over the place 01

It's a mixed bag of results for different manufacturers, with Hyundai, Volkswagen, Nissan, Mercedes-Benz, BW, and Volvo all in significant recovery or fully recovered - but Toyota, General Motors, and Ford are still suffering shortages. Honda still has an uncertain outlook related to the shortage, with production expected to remain lower than pre-pandemic levels for at least the next year.

Even if chip supply logistics are getting better, a temporary shift from custom made chips towards general purpose semiconductors should continue, with Infineon Technologies and Renesas Electronics recovering through shortages in 2022. STMicroelectronics is sold out through next year, while NXP Semiconductors and Texas Instruments still seeing inventories below desired levels.

Bill Jewell, a consultant and analyst at Semiconductor Intelligence, said this in a recent blog post:

"Automakers are adjusting their just-in-time inventory models. Automakers are also working more closely with semiconductor suppliers to communicate their short-term and long-term needs. Semiconductors will become even more crucial to automakers as trends toward electric vehicles and driver-assist technologies continue."

Toyota recently announced it plans to manufacture 800,000 vehicles across the globe next month, a figure 100,000 short of its intended plans. The Japanese company disclosed plans in August that it hoped to manufacture 900,000 vehicles per month through November, but that number simply wasn't feasible.

Recovery from the pandemic occurred sooner than automakers expected, and their hesitancy to purchase chips put them behind the PC industry, smartphone manufacturers, and other tech sectors. Growing demand for electric vehicles and standard vehicles that rely on technology for infotainment, performance tech, and safety also stymies efforts to successfully emerge from this slump. As the year draws to a close, 2023 might prove to be another interesting experience for the auto industry that is under dizzying change from the consumer market.

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An experienced tech journalist and marketing specialist, Michael joins TweakTown to cover everything from cars & electric vehicles to solar and green energy topics. A former Staff Writer at DailyTech, Michael is now the Cars & Electric Vehicles News Reporter and will contribute news stories on a daily basis. In addition to contributing here, Michael also runs his own tech blog, AlamedaTech.com, while he looks to remain busy in the tech world.

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