SHORT CIRCUITS

THE GLOBAL SEMICONDUCTOR SHORTAGE HAS COST CARMAKERS MORE THAN A$140 BILLION, AND MORE SUPPLY PAIN IS PREDICTED. IS YOUR NEW CAR AFFECTED?

- CHRIS THOMPSON

THE GLOBAL CAR industry is facing a production crisis due to the shortage of semiconductor chips, which are needed in just about every electronic device on the planet. It’s wreaking havoc on vehicle supply chains, leading to instances like the thousands of new Ford F-Series pick-ups parked in limbo at Kentucky Speedway, almost complete but missing crucial electronic components.

New cars can require thousands of these chips, but when COVID-19 outbreaks shut down automotive factories in 2020, carmakers cancelled semiconductor chip orders expecting not to need them. The tech industry, fuelled by a shifttowards home life, absorbed that chip supply. Lockdowns ended, and the demand for cars skyrocketed, but there were far too few chips to meet it.

Globally, the car industry has suffered to the tune of more than €90b (A$141b) according to research firm AlixPartners.

In Australia, the local industry is feeling the effects of overseas delays, and waiting times for some vehicles have ballooned to many months as demand for new cars has increased in the wake of global lockdowns lifting.

Wheels understands the situation to be more severe than many insiders will admit. Behind the scenes, industry experts say companies are battening down the hatches for a lag in vehicle deliveries well into 2022, anticipating the effects will likely be felt even through 2023.