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I think the automotive chip shortage actually shows the opposite of what you think it does. The industry largely shut down, a global pandemic causing massive s
by Retric 3y ago
I think the automotive chip shortage actually shows the opposite of what you think it does. The industry largely shut down, a global pandemic causing massive shipping issues for a huge range of components hitting a complex industry focused on just in time supply chains and complex logistics combined with poor forecasting of demand resulted in a 12% reduction in output over a year. Which then quickly caught back up.
That’s so wildly far from catastrophe it’s laughable, economic swings frequently have larger impacts on car sales. The pandemic hurt the automobile industry less than several others, companies didn’t fail, and things quickly caught back up.
So yes disruptions mean a temporary reduction in output and possibly a significant period catching up, but suggesting it would take an industry years to deal with X issue just doesn’t line up with how companies actually behave.
- chasil 3y agoAs I understand it, the "legacy" production capacity that the automobile manufacturers canceled/forfeited was (re)sold to other customers. When car sales picked up, the order books were full and there were were no immediately-available fabs. The foundries did not appear to have as substantial of a downturn.