Giant semiconductor shortage weakens automotive industry
Audio 03:21
An assembly line at the Volkswagen plant in Wolfsburg.
REUTERS / Fabian Bimmer / Files
By: Dominique Baillard Follow
7 min
The shortage of semiconductors is forcing the automotive industry to curtail production.
A shame when the demand starts again.
Where does the problem come from ?
Publicity
In Germany, the United Kingdom or the United States, factories are now shut down or in reduced activity, due to a lack of semiconductors.
Delivery times have been reduced from a few weeks to a minimum of several months.
We discover how essential these components have become.
Chips are everywhere today in our daily lives and therefore in our cars.
As vital to our economy as oil was in the 20th century.
The auto industry would have done well without such a failure.
After a difficult year in 2020 due to the pandemic, order books were again filled in the last quarter, well beyond the expectations of manufacturers.
But now they are unable to answer it.
The pandemic partly explains this damage
Firstly, because the strong demand for laptops for teleworking, or for gaming consoles, has in turn caused the demand for semiconductors to explode.
Just like the rise of 5G.
The current shortage is also a consequence and a variation of the trade war between China and the United States.
By threatening sanctions on companies seeking to source semiconductors from China, Donald Trump's administration froze new flows that could have absorbed this unusual demand.
Who are the major semiconductor producers today?
With Intel, Qualcomm, Apple or even Nvidia for graphics cards, the United States are still the first in a world market estimated at 450 billion dollars in 2020. Major players but still very dependent on Asian founders, those who produce the silicon wafers on which the chips are etched.
The South Korean Samsung and especially the Taiwanese giant TSMC, are the world champions.
The Trump administration wanted to strengthen made in America to remedy this fragility but also to prevent China from becoming a major player in this strategic market.
Beijing is still lagging behind.
Still important 80% of its needs.
In its anti-Chinese assault, the US administration has also weakened other potential competitors.
European competitors, for example?
Like the leading European manufacturer, the Franco-Italian STMicro Electronic, which had to give up delivering Huawei under American pressure.
A declining first in the class, it no longer appears in the top ten of world manufacturers established by the Gartner firm.
The number two in Europe, the Dutch NXP specializing in chips for the automotive industry either.
To expand its offer, Europe dreams of an alliance to build a factory comparable to that of Samsung or TSMC, why not by offering them a partnership.
About ten European countries are working on it, including France.
If necessary, it will be necessary to know how to attract these partners with very advantageous conditions because Europe is only a minor outlet for the Taiwanese, only 6% of its sales, the United States 60%.
Until these projects materialize, the shortage is expected to last, at least until 2022.
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