Chip shortage hitting auto jobs

hitech 2021-05-18 09:42:32

The chip shortage is expected to cost the  auto industry $110 billion in revenue in 2021, according to consultants AlixPartners which says that production of 3.9 million vehicles will be lost.

The US car industry is lobbying the US government to invoke emergency powers to force the semiconductor industry to make chips for cars as a priority.

Consumer and mobile device IC suppliers have lobbied the US government not to interfere with its contracted production schedules.

Toyota is already implementing moves away from the car industry’s just-in-time delivery practice which has meant that car companies do not keep stocks of chips.

The auto industry precipitated the auto chip shortage crisis when it cancelled orders last winter in the belief that coronavirus would affect vehicle sales. It did, but not for as long as expected. When the car companies re-ordered chips it found their place in the chip-makers’ order books had slipped from between four months to a year.

Stellantis, which employs 400,000 people, blamed “the unprecedented global microchip shortage,” for the cutback in Jeep production leading to the job cuts.