Integrity Score 2097
No Records Found
No Records Found
No Records Found
Automobile companies in the U.S. want the government to step in to tackle a crisis that is not of their making. General Motors and Ford are the latest companies that have announced halting of production in several of their factories over a shortage of semiconductors.
Semiconductors are basically silicon chips that are used to perform a variety of functions such as brakes, navigation, Bluetooth, steering, and others. The U.S. imports most of the chips from abroad.
The industry has blamed the crisis on semiconductor companies that diverted chips to other industries during the pandemic. They diverted the semiconductors to laptops, phones, gaming systems, and others. Honda, Toyota, Volkswagen, and others have also announced cuts in production because of the shortage.
According to a data company, IHS Markit, the shortage of chips could cause 672,000 fewer light-duty vehicles built globally in the first quarter of this year. [https://www.freep.com/story/money/cars/2021/02/24/chip-shortage-automakers-biden/4573587001/].
The situation is so serious that President Joe Biden signed an executive order recently to review the U.S. supply chains of products, including semiconductor chips. Congress will also be asked to approve $37 billion to help increase silicon production within the U.S. But experts say that this is unlikely to solve the problem soon.
For instance, in a letter to the Commerce Department, the Alliance for Auto Innovation has said that automakers and suppliers fear that the shortage could last for another six months. This will have “serious consequences for their workers and the communities in which they operate” wrote John Bozzella, the group’s president and CEO.
The auto industry is facing a crisis, so are gaming console and headphone manufacturers. [https://www.nytimes.com/wirecutter/blog/silicon-chip-shortage-delays]
With the demand for laptops and other accessories, which saw an immense demand after the worldwide lockdown, decreasing and economies opening up, silicon chip makers may go back to producing chips for cars and others. But that transition is likely to take place in months.
Read more:
The semiconductor shortage crisis:
https://www.washingtonpost.com/technology/2021/04/08/gm-manufacturing-chip-shortage/
How the shortage is affecting everything:
https://www.cnet.com/news/from-ps5-to-ford-f-150-how-a-global-chip-shortage-is-impacting-everything/