Automakers expect chip shortage to last
omakers have started giving early warnings that the global microchip shortage that has slowed the industry's production level this year won't end soon.
"The semiconductor crisis, from everything I see and I'm not sure I can see everything, is going to drag into '22 easy because I don't see enough signs that additional production from the Asian sourcing points is going to come to the West in the near future," said Carlos Tavares, the CEO of Chrysler owner Stellantis, at an Automotive Press Association event in Detroit July 21.
Executives from Daimler AG made similar warnings, but Chief Financial Officer Harald Wilhelm said the shortage would be less severe next year.
Seeking alternatives to automotive
Tough conditions in the auto industry are prompting one auto supplier to expand into the medical field.
Cadillac Products typically makes sound deadening and protective systems for the auto industry, but when COVID-19 hit, it began producing medical gowns and personal protective equipment. It's now turning that temporary business into a subsidiary: ProTEC-USA.
PN's Sarah Kominek and Kurt Nagl of our sister paper Crain's Detroit Business visited the new business late last week. Cadillac Products aims to sell 2 million pieces of PPE with the new business.
"If I could get this to 25 to 30 percent [of overall revenue], that would be great," said Mike Williams, vice president of operations and purchasing.
The company has made 1.2 million pieces of PPE so far, but the bulk were donated to medical responders. However, the company believes it is well positioned to respond to efforts to make more medical equipment in the U.S.