Stock take: Experts drill into the motor industry's chip issues

Posted in CAR NEWS on September 19, 2021
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IH “The just-in-time model is actually essential to the economic function of the industry. I do wonder whether, within that, we will see some changes in the geography of production, in that some supply that is from Asia will move to Europe in order to shorten the supply chains.”

Will there be rises in the price of new cars?

MH “It’s too early to say. The market is always very, very price sensitive. Invariably, if your input costs are going up – and this is not just about selling conductors as we saw the price of steel go up dramatically last year – then ultimately that will translate into price adjustments. To what extent and when remains to be seen.”

Will car makers ever out-punch the tech firms?

IH “I don’t think the car companies, no matter how big they are, will be able to out-punch the tech sector, which has bigger volumes – and, I would argue, higher sophistication of demand. But I think one way around that is that there may well be more automotive-specific chip production facilities, to achieve greater security of supply.”

CHIP MANUFACTURER BOSS BELIEVES: “YOU AIN’T SEEN NOTHING YET”

Intel is a vast, multinational technology company (remember the Intel corporate ‘bongs’ that ran in every single PC advert?) and is one of the world’s largest semiconductor manufacturers, employing 116,000 people in total.

Its CEO, Pat Gelsinger, told a recent conference that “cars are becoming computers with tyres”. His view of the current crisis isn’t an encouraging one because he believes “you ain’t seen nothing yet”, making the point that European semiconductor production has fallen from 40% to just 9% today as a global percentage.

Source@Tautocar.co.uk: Read more at: Best Sport Cars