The enormous shortage of microchips faced by many car manufacturers is becoming a real crisis. A fire in a factory where such chips are made will cause further deterioration.
A fire recently raged at the Japanese chipmaker Renesas, which may increase chip shortages at car manufacturers. The company, one of the largest suppliers of chips for the automotive industry, has shut down production completely. The manufacturer says it will take at least one more month before chips are manufactured again. One of Renesas’ largest customers is Toyota. At the moment Toyota cannot say what the fire means for production. It says to ‘study’ the situation.
The fire at Renesas comes at a time when manufacturers of cars, smartphones and other electrical appliances are already suffering a lot from a shortage of chips. Several car manufacturers, including Ford, Volkswagen and General Motors, have previously been forced to temporarily shut down some production lines. Ford has therefore decided to assemble incomplete cars in the United States. They are then ready for when the chips are back and the vehicles will of course not be delivered before they are in them. The chip shortages are largely the result of the corona crisis. Car manufacturers scaled back orders when car production fell last year. Now car production and demand are picking up again, but of course chip manufacturers have also scaled back their production. As a result, car manufacturers now have to wait longer to meet renewed demand.