As indicated in the report released in August by IHS Markit, a business consulting firm, global auto production is likely to drop by as much as $7.1 million this year due to the shortage of semiconductor chips worldwide and the supply chain crisis resulting from the epidemic. This stalemate will likely cause the auto industry much trouble.

impact analysis 
 

In addition to IHS Markit’s report, the sales volume for cars worldwide in the second quarter of 2021 has increased by 35.1% compared to the same period last year. This is based on LMC Automotive’s statistics. The overall sales of shipments in the second quarter were the same as those in the first quarter, indicating a slow climb to pre-epidemic levels. This shows that the auto industry is gradually returning to the right track globally. However, this also suggests that the current market is still in a state of chip shortage. Thus, automobile production is unable to keep up with the pace of demand which will ultimately suppress the final sales volume to a certain extent.

 

 

In the investor conference this season, TSMC originally stated that it would honor its promise to fully support automotive chips for international car factories and it is expected that the shortage situation would improve in Q3. However, factories that assemble all types of semiconductor chips have closed due to the spread of epidemic and lockdown measures in Southeast Asian countries. The situation has, once again, caused the auto industry the predicament of chip shortages. As such and as a measure to avoid repeating the mistake of insufficient automotive chips, auto manufacturers have changed their previous "just-in-time" mode and shifted to prepare automotive panel inventories 3 to 6 months in advance. Furthermore, they must pay attention to the problem of material shortage in the second half of the year if the issue is not alleviated or the growth for the automotive market is not surging as expected. If not, board manufacturers and customers will have to face huge inventory pressures.