Once again, the auto industry awaits
From the May 2021 issue of Car and driver.
The ripple effect of the pandemic has hit the auto industry where it hurts – right at the end of the supply chain. The microchips that control everything from your 30-way power adjustable massage seat to your engine’s fuel injectors are as rare as toilet paper was a year ago. This ruins things for the automakers, who can no longer build as many cars as they want. At the time of going to press the May issue of Car and driver, the chip shortage halted the production of nearly 2 million vehicles worldwide. The numbers only got worse.
Last week, Bloomberg highlighted a recent report by global consulting firm AlixPartners which estimates that 3.9 million vehicles will be affected by the shortage. AlixPartners predicts it will eventually cost the global sales market $ 110 billion this year, even with vehicle prices rising. Last month, announcing its second quarter results, Ford said it expected the chip shortage to affect 1.1 million vehicles and cost the company $ 2.5 billion.
This is not the first time that such a thing has happened. In 2004, a booming Chinese economy suddenly prevented automakers from finding steel. That shortage has taken GM to court with two of its suppliers over pricing, and Nissan and Suzuki have shut down production altogether. A violent labor dispute at a transmission parts supplier in Gurugram, India, forced Ford to temporarily halt production at its Oakville, Ontario plant in 2009. Fortunately, no one seemed to notice or care. that there weren’t that many Ford Flex at the dealership. a lot. In 2011, the tsunami that hit Japan wreaked havoc throughout the supply chain, even limiting the color of the car you could find. At the time, the global supply of Xirallic, a pigment with metal-coated glitter that gives pearlescent paints a shimmering appearance, came from a single factory, which was exposed to radiation after the tsunami damaged a reactor. nuclear nearby.
Sometimes parts get stuck in shipping ports, waiting for customs clearance. Sometimes there is a fire, a tornado or a flood. Sometimes a supplier goes bankrupt or can’t scale up production of a key material like nylon or resin, something you might not even know is in your car. Other times it’s something you’ll definitely notice it’s missing, like a steering wheel.
Supply chain managers, the ones who make sure these gaps occur as little as possible and rush to find solutions when they do, are the unsung heroes of automotive manufacturing. But they are not magicians. They can’t conjure up microchips in a world that is increasingly dependent on computer brains. Like many of us for so many reasons this year, we just have to wait.
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