OEMs, suppliers and EU officials are considering how best to develop Europe’s semiconductor supply bases to mitigate current and future shortages, but the broad gaps at many levels – including for older, larger chips – mean there will be no magic bullet
That production of semiconductors is of growing importance for today’s cars has become more evident across the automotive value chain. But the post-Covid shortage of computer chips, combined with the automotive industry’s reliance on just a handful of suppliers, has created a perfect storm in the supply chain. Globally, the automotive industry has lost more than 2m vehicles in terms of production in 2021 through to the middle of April, according to IHS Markit, including around 450,000 units in Europe.
As in the US, officials in the EU are anxious to avoid further disruption to the automotive and electronics sector. The European Commission is pushing to increase local investment and production in semiconductors in Europe. The question is: how feasible is it for Europe to make gains in this sector and will it help the automotive sector to mitigate the current crisis?
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