Chip supply, testing woes to further curb light vehicle production in 2021


Packaging and testing operations within the semiconductor sector in Malaysia were impacted due to the government's lockdown measures in early June, IHS said, compounding difficulties in an already constrained supply chain.

Semiconductor shortages and the delayed packaging and testing of the chips will cause production of global light vehicles to drop by five million this year, data firm IHS Markit said on Thursday, marking the biggest cut to its outlook in nine months.

Citing supply chain challenges, IHS said it was cutting its light vehicle production forecast by 6.2% for 2021 and 9.3% for 2022, to stand at 75.8 million units and 82.6 million units, respectively.

Packaging and testing operations within the semiconductor sector in Malaysia were impacted due to the government's lockdown measures in early June, IHS said, compounding difficulties in an already constrained supply chain.

"Our interpretation of the situation in Malaysia, which is responsible for 13% of the global supply of semiconductors for the automotive industry, has become more pessimistic," IHS said.

StarCarSifuStarCarSifu

"The two-and-a-half-month backlog that has built up since June will take time to clear and is anticipated to extend well into 2022."

Automakers from General Motors to Japan's Toyota have slashed output and sales forecasts due to scarce chip supplies, made worse by a COVID-19 resurgence in key Asian semiconductor production hubs.

IHS said the semiconductor snafus have resulted in lost production of 1.44 million units in the first quarter and a further 2.6 million units in the second quarter.

Currently, losses in the quarter are running at 3.1 million units and rising, nearly double its previous forecast.

"The outlook for Q4 now reflects heightened risk as challenges to the supply chain – primarily semiconductors – remain entrenched."-

Meanwhile, Czech carmaker Skoda Auto, part of the Volkswagen group, will halt production at two domestic plants for a week at the end of September due to chip shortages, the company said on Thursday.

From delayed car deliveries to a supply shortfall in home appliances and smartphones, businesses and consumers across the world have been facing the consequences of an unprecedented shortage https://www.reuters.com/business/autos-transportation/when-chips-are-down-global-shortage-keep-crimping-carmakers-2021-08-03 in semiconductor microchips.

In the Czech Republic, production has been hit in the auto sector, a key driver of the economy. Skoda has thousands of cars unfinished as it waits for chips.

"Recent COVID-19 outbreaks in Asia, for example in Malaysia, are forcing semiconductor manufacturers to close their factories again. This has resulted in industry-wide adjustments to car production, and SKODA AUTO is also affected," the company said in an emailed response to Reuters questions.

"We will therefore stop our production lines in the Mladá Boleslav and Kvasiny plant in calendar week 39."

It did comment on any impact on its third Czech site, components factory at Vrchlabi.

The head of Skoda's union, Jaroslav Povsik, had earlier told a union newsletter that cancelled shifts would be added to planned holidays on Sept. 27-28 to mark a state holiday.

Skoda said it expected semiconductor production to be ramped up in the fourth quarter.

"We expect the overall supply situation to ease by the end of the year," it said.

Skoda is one of three carmakers in the central European country. The other two are South Korea's Hyundai Motor Co and Japan's Toyota Motor Corp.

Toyota has also been forced to halt production at its Czech plant for periods in the past few months.

While manufacturers have had to grapple with global supply and transport bottlenecks caused by the COVID-19 pandemic, the Czech economy has returned to solid growth after a massive contraction in 2020.

Manufacturing sentiment has also stayed strong, but has slipped from records seen in earlier this year.

Volkswagen's Spanish unit SEAT plans to extend partial car assembly suspensions at its plants near Barcelona well into 2022 because of the chip shortage. - Reuters

Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 46
Cxense type: free
User access status: 3
Join our Telegram channel to get our Evening Alerts and breaking news highlights

IHS Markit , chips , supply , chortage , Malaysia , lockdown , vehicles , Skoda ,

   

Next In Business News

China stocks rise as property and coal shares boost; HK down
China Evergrande secures extension on defaulted US$260m bond
Singapore charges two people for corrupt marine fuel trading practices
FBM KLCI slips below 1,600 as bank weigh
Rehda: Govt intervention crucial if material cost problem serious
CIMB to provide property financing to Juwai IQI customers in Malaysia
Etiqa General Insurance wins top motor insurance award
Strong commodities performance boosts ringgit
Trading ideas: Tenaga, Pestech, Bintai Kinden, Daya and SKB
IGB sells 50% stake in London real estate for RM600mil

Others Also Read


Vouchers