Automakers hunt high and low for chips as supply crisis worsens
Written by: Aditi Shah, Daniel Leussink and Rachel More
TOKYO/BERLIN (Reuters) – A deepening semiconductor supply shortage linked to Dutch firm Nexperia threatens auto production across the industry, while global automakers are scrambling to find chips and checking with suppliers to see if there is enough stock.
Beijing banned the export of Nexperia products from China after the Dutch government seized control of the chip maker last month, citing concerns about the transfer of technology flagged by the United States as a possible national security risk to its Chinese parent Wingtech.
On Wednesday, the Association of European Automobile Manufacturers warned that automotive factory programs would soon be disrupted due to chip shortages tied to Nexperia. “The industry is currently operating with reserve stocks, but supplies are rapidly dwindling” and alternative suppliers will need months to build up stocks, the group said.
Nissan Motor and Mercedes-Benz are among automakers trying to deal with the uncertain supply situation, with Nissan saying it has enough chips by the first week of November.
Honda suspended production at a plant in Mexico on Tuesday and began adjusting production in the U.S. and Canada, a spokesman said.
THE LAST CHALLENGE FOR A STRUGGLED INDUSTRY
Some manufacturers in Brazil may be forced to cease operations within two to three weeks if the crisis continues, according to a Brazilian government official.
Nexperia’s chips are widely used in automotive components, making the supply shortage the latest challenge for an industry already grappling with U.S. tariffs and Chinese restrictions on rare earth exports.
“This is a big problem,” Nissan’s Performance Director Guillaume Cartier told reporters at the Japan Mobility Show in Tokyo. “We don’t have full visibility right now.”
Cartier said the automaker is “in good shape through the first week of November” in terms of chip supply.
Even if automakers have learned from pandemic-era shortages and stockpiled chips, they are still at the mercy of their suppliers, including smaller suppliers, he said. While it’s possible to have visibility into the largest “Tier 1” suppliers, it becomes more difficult further down the supply chain, he said.
Marc Winterhoff, CEO of US electric vehicle manufacturer Lucid Group, said the company’s engineering team had found alternative materials and the impact on production plans had been postponed. “It’s developing in the right direction,” he said at the Reuters Automotive USA conference in Detroit.
