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The Global Chip Shortage: How the Semiconductor Crisis Impacted Auto Manufacturing

A close-up of semiconductor chips, symbolizing the global chip shortage's impact on the auto manufacturing industry.

The shortage of chips used in auto manufacturing is felt around the globe as major suppliers have to close production lines. The chip shortage began to manifest itself as early as the beginning of the Covid-19 crisis in 2020. According to Bloomberg the shortage is due to overly cautious demand forecasting once the production lines closed last year, and an increase in demand for consumer electronics throughout the corona crisis. While demand for automotive chips was low, most manufacturers switched their production to consumer electronics, and customers such as Apple took a big share of the production capacities.Prewave has picked up on a global shortage of semiconductor parts for the automotive industry as early as the beginning of December 2020, with major automotive manufacturing halting their production in the beginning of 2021.