Mercedes Warns Chip Shortage To Continue Into 2023

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Manufacturers are struggling to produce cars.

The ongoing chip shortage in the automotive industry will likely continue into 2023. This is according to the CEO of Daimler AG, Ola Kallenius.

Kallenius stated that the shortage would continue for the immediate future but that the situation will likely improve in the fourth quarter of 2021. That being said, the existing structural problems will still negatively affect 2022, with things only getting better in 2023. The current shortage is particularly relevant to Mercedes-Benz, as it's currently busy taking the fight to Tesla. It will roll out a few EVs shortly, including the EQE and the first dedicated all-electric AMG model.

Daimler
Daimler
Daimler

This shortage comes at a particularly rough time in automotive history. Semiconductor chips are used for multiple reasons. They're used in ECU management, driver assistance features, and even something as mundane as the infotainment interface. A basic EV requires even more semiconductors, thanks to battery management.

The chip shortage is causing big problems for the US car industry. In late August, Ford had to hit the pause button on the F-150 assembly. Both the Oakville and Kansas City assembly plants were shut down for a week. Two of the three shifts at the Dearborn Truck Plant were also halted. Considering the F-150 is Ford's bread and butter, this must be hitting them hard. The chip shortage is also impacting Bronco production, which is a huge problem considering it is the car of the moment right now.

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Nissan also took a big hit back in May, as it announced the chip shortage would impact both the new 2022 Pathfinder and Frontier. Volkswagen had to cut production by 100,000 vehicles in the first quarter of 2021.

The only manufacturer that seems to be coping is Hyundai. It simply prioritized products that are in high demand, ensuring a steady supply. That means top-selling models like the Tucson will still be readily available, giving Hyundai the edge in a highly competitive segment.

With the outlook for 2022 still looking semi-bleak, other manufacturers might want to glance at what Hyundai is doing at the moment.

Hyundai
Hyundai
Source Credits: Business Today

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