The delivery bottlenecks disappear – just not with the cars

chip manufacturing

The semiconductor shortage is coming to an end – but not for the car industry.

(Photo: Bloomberg)

Munich Good news for the suffering customers of the chip industry: The lack of semiconductors is slowly disappearing. Gartner’s market researchers expect “component shortages to gradually ease and prices to stabilize as inventory improves,” according to analyst Alan Priestley.

The bad news: According to Gartner, the car industry will have to tremble for the components well into next year. The so-called microcontrollers in particular are still scarce. These are minicomputers that process sensor data in many places in vehicles, communicate with the on-board system and control the car’s functions. There is also a lack of semiconductors for power management and voltage regulators.

Because the chips are missing, car manufacturers around the world have to stop their production again and again. BMW only announced this week that production in Regensburg is at a standstill.

According to Gartner, car manufacturers must therefore prepare for further increases in chip prices. The auto semiconductor business is expected to grow 19 percent this year, compared to just 13.6 percent for the overall chip market.

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Too little invested in autochips

The shortage of autochips is likely to persist because the components are manufactured using more “mature” processes. The latest, most powerful technology is usually installed in PCs and smartphones. In the case of autochips, on the other hand, reliability and ease of mass production play a greater role. For years, contract manufacturers in the Far East have invested too little in these tried-and-tested technologies, but the demand is huge because of the electromobility boom.

In addition, car buyers are ordering more and more driver assistance systems; this also requires additional chips.

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In contrast, the situation with chips for computers and mobile phones is easing. “Since the end of 2021, the gaps between supply and demand have been shrinking, signaling an approaching end to the supply shortage,” according to market observers from Counterpoint. In the case of image sensors, the analysts even expect prices to fall this year. The so-called dram memory chips should also become cheaper.

This is also because the electronics boom triggered by the pandemic is over. According to the analysts at Canalys, smartphone manufacturers shipped around a quarter fewer devices in the first three months of the year than in the same period of 2021. The lockdowns in China are responsible for this, but also the war in Ukraine, which is unsettling consumers – as well as the generally sharply rising prices. A positive for chip buyers is that “the painful component bottlenecks could improve earlier than expected, which will certainly help to reduce cost pressure,” according to Canalys experts.

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Market researchers also see declining sales in other electronics segments: According to IDC, the number of PCs and notebooks delivered also fell in the first quarter by five percent. According to Trendforce, sales of televisions have fallen by a fifth.

Semiconductor manufacturers like the Munich Dax group Infineon still don’t have to worry about their business. According to IC Insights, capacity utilization in the industry’s plants is unlikely to fall compared to the record year 2021. And that despite the fact that ten large factories are to go into operation worldwide. The additional capacities should ensure that delivery times will drop from the current average of six months. Gartner forecasts total sales in the chip industry of 676 billion dollars for the current year – 81 billion more than in 2021.

More: The chip paradox: why business is booming and stock prices are suffering

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