Microchip shortage: global auto industry forced to cut production

It is a symbol of the revolution which is transforming the global automobile industry: for lack of electronic chips, factories are at a standstill.

More and more today, the value of a car lies in the electronics and software it contains.

An electric or hybrid car contains two to three times more electronic chips than a conventional car.

It is less visible than the wheels, but without its drivers, cars cannot drive.

However, the world market suffers from a shortage.

As a result, several factories of Renault, PSA, Ford, Volkswagen, in short all the big ones, are forced to reduce their rates or even to come to a standstill.

Renault, for example, announced two to three days of shutdown this week at three sites.

We discover on this occasion to what extent we are dependent on a few suppliers.

This is the effect of globalization and specialization.

In the pharmaceutical industry, we became aware, with the Covid crisis, to what extent we were dependent on China and India, sometimes up to 80% or 90%, for the supply of the active ingredients necessary for the manufacture of drugs.

In the automobile, it's the same or even worse.

Only one Taiwanese semiconductor manufacturer, TSMC, manufactures 70% of the integrated circuits for the entire automotive industry globally!

However, with the Covid, the demand for electronic products has exploded.

Add to that the development of 5G, which also consumes a lot of chips.

And this is how the few suppliers of these components are suddenly overwhelmed.

This will cost the global auto industry dearly as nearly 700,000 cars will not be able to leave factories this quarter.

Ford cites losses of up to $ 2.5 billion.

There are few chipmakers left in Europe: there is STMicroelectronics, a Franco-Italian group, or even Infineon, a German.

As with drugs, maintaining a chip industry on European soil appears to be a strategic issue: it was time to realize it.