SEMICONDUCTOR SHORTAGE PERSISTS

The Chip Crisis or some may know as the semiconductor shortage continues and the industry hopes for a post pandemic sales recovery are looking volatile at the moment.

Today, millions of products - cars, washing machines, smartphones, and more - rely on computer chips, also known as semiconductors. Currently there just aren't enough of them to meet industry demand.

The pandemic upended supply chains in nearly every industry and the automotive industry was one of the worst affected. There was a massive hope for the industry that 2021 would recover from the millions of lost sales brought on by the stay-at-home measures during the 2020 pandemic, however semiconductor shortage continues to bring widespread factory stoppages.

Last month, IHS Markit, which many automakers use as their benchmark for production forecasting, said it was trimming its production forecast by 6.2 percent, or 5 million units, to 75.8 million for 2021.

"The outlook for Q4 now reflects heightened risk as challenges to the supply chain – primarily semiconductors – remain entrenched,” IHS analyst Mark Fulthorpe wrote.

Manufacturers such as VW have up to 50,000 “incomplete” missing critical parts that need to be added before they can be sold on, IHS said.

In contrast to earlier statements from automakers and analysts expecting a recovery in the second half of 2021. Automakers and car shoppers may not see any sort of relief until the second half of 2022 before supplies recover in 2023.

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