14.2 F
Monday, January 24, 2022

    Latest Posts

    New forecast says chip shortage to cost the car industry $210B

    The ongoing global shortage of semiconductor chips will hit carmakers harder than experts had initially forecast in May as COVID-19 continues to disrupt chip production.

    A new report released Thursday by consulting firm AlixPartners said the chips crisis will cost the global auto industry $210 billion in revenues this year. That’s almost double its  estimate in May of $110 billion. 

    In terms of production, AlixPartners forecasts that automakers will lose production of 7.7 million vehicles this year. In May, it had forecast a production loss of 3.9 million.

    “Of course, everyone had hoped that the chip crisis would have abated more by now, but unfortunate events such as the COVID-19 lockdowns in Malaysia and continued problems elsewhere have exacerbated things,” said Mark Wakefield, global co-leader of the automotive and industrial practice at AlixPartners in Southfield.

    The chips are used in a variety of car parts. The worldwide shortage started earlier this year, in part, as a result of the COVID-19 pandemic. As people increasingly worked from home and kids were home-schooled, the demand rose for the personal electronics that the chips are used in.

    Latest Posts


    Don't Miss

    Stay in touch

    To be updated with all the latest news, offers and special announcements.