Expert: Chip shortage a wake-up call for auto industry
November 01, 2021
But out of nearly 20,000 orders for GAC Aion's new energy cars last month, only about 13,000 were delivered to customers. A shortage of chips means the company, like many others, is struggling to fulfill its orders on time.
"The impact is severe. We only have 60 or 70 percent of the chips we need. It puts our production in limbo – we are not even sure if next week's chips will arrive," said Gu.
"The biggest shortage is in the car's main control unit, because they are designed to much higher safety standards. They need to operate from minus 40 degrees to more than 100 degrees Celsius.”
The holdup on specialized chips is why Gu thinks the company will lose out on 30 percent of earnings this year.
Chinese electric-vehicle and battery maker BYD, the country's top-selling EV brand for five months in a row, is also hobbled by the crisis. The Shenzhen-based firm saw first-half net profits fall 30 percent as shortages of chips and lithium increased costs.
According to consulting firm Alixpartners, global automakers will lose $210 billion in revenue this year due to the ongoing semiconductor chip shortage. The forecast also considered rising costs of commodities such as steel and plastic resin.
"Automakers could have tight inventories until late 2022 or early 2023," said Dan Hearsch, a managing director in Alixpartners auto practice.