There is a crisis of chip shortage that is going on across the globe. The shortage started as there was a huge surge in chip demand during the lockdown when consumers were stocking up electronic gadgets and personal computers. This has led to a severe chip shortage that is now threatening production of cars and play stations on a global scale.
General Motors (GM) made a statement this Tuesday, February 9th saying that the company will be extending production cuts across Canada, Mexico and the US till the mid-week of March, 2021. The decision to extend comes after the chip shortage situation doesn’t improve over the past couple of weeks. GM will be joined by a long list of automaker giants like Honda, Ford, Fiat Chrysler and so on. All of these companies have either slowed down the production rate or warned investors about the chip shortage crisis that will be affecting them.
Chip Shortage Leads To 8.4% Increase In Semiconductor Production
But this deficit of semiconductors is not affecting the automobile industry alone. Among the other industries that are struggling because of this chip shortage is the electronics industry. Over the past weeks, companies like Qualcomm and AMD, who are among the top chip manufacturers, have noted this shortage. Electronic giants like Sony have also issued a statement recently saying that chip shortage is behind the delayed production of the PS5 console.
The semiconductor industry’s demand has rapidly surged owing to the pandemic and the increase in demand. The Semiconductor Industry Association recently mentioned in a statement that they will be increasing chip production by 8.4% this year. This is a huge jump from a5.1% growth over the span of 2019-2020. They also acknowledge the semiconductor shortage crisis that is affecting worldwide electronics production currently.
