26 Jan 2021 -

China chip shortages may be persistent problem

China’s automotive chip shortage could persist for as long as a decade , but according to industry insiders the problems go deeper than current supply glitches.

Short-term disruptions caused by Covid-19 will resolve naturally, according to general manager of the National New Energy Vehicle Technology Innovation Center, Yuan Chengyin. However, more serious issues such as overwhelming domestic demand for electric vehicles, a lack of domestic technical knowhow and sustained geopolitical tensions will strangle supply.

“China’s chip industry is under tremendous pressure,” Yuan told Bloomberg. “I don’t think the issue can be solved overnight.”

Auto News reports that China’s Association of Automobile Manufacturers believes the current chip shortages may persist into the second quarter, but Yuan sees a more systemic longer-term problem that won’t be resolved until Chinese companies build up their own manufacturing capabilities and make the semiconductors used in EVs.

“That’s the huge challenge,” said Yuan, who’s also behind the country’s first government-backed car-chip industry body, the China Automotive Chip Industry Innovation Strategic Alliance. “If we don’t address it, the auto industry could go back to where it was decades ago” in terms of competitiveness.

China is the world’s biggest automotive market, with wholesale deliveries totaling 25.3 million units in 2020. Vehicle sales are expected to increase this year for the first time since 2017, reaching about 27.2 million units, says Auto News.

To avoid electronics supply-chain disruptions, you may also wish to consult an expert in electronics component supply. With more than three decades of supply-chain expertise, Astute Electronics is ideally placed to work with you on your daily component requirements.

Either through the hundreds of manufacturers we purchase directly from, or the international network of component supply-partners offering full product traceability, Astute Safe-Supply, run by sourcing experts and offers a deeper insight into the global components markets.

With real-time access to the latest listings and prices cultivated through several decades of close supplier partnerships, we are able to spot price disparities and leverage product price variances to deliver cost-effective solutions to customers, whilst ensuring a quality, risk-free supply.

For more help with looking at supply chain options, contact Astute Electronics here

Related News

14 Jun 2024 - Defence

Webinars for Defence, Military, and Aerospace Engineers 

Read more

12 Jun 2024 - General

Electronics industry surges forward into 2025

Read more

07 Jun 2024 - General

Nvidia’s dominates – for now. A look at alternatives.

Read more

06 Jun 2024 - General

The CHIPS Act’s $39 billion challenge: building Fabs is easy, finding talent is not

Read more

05 Jun 2024 - Defence

New Events Series for Defence, Military, and Aerospace Engineers 

Read more

04 Jun 2024 - General

What is Taiwan’s Silicon Shield, and is it so tough?

Read more