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Old 04-11-2011, 02:07 PM   #1
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Default The big threat: Chip shortage

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TOKYO -- The world's largest maker of automotive microcontrollers -- the electronic brains that control millions of vehicles built by major automakers -- is shifting production from a key crippled plant to two other plants, but it will take months before shipments can start.

The move by Renesas Electronics Corp., which controls 41 percent of the global automotive chip market, signals months of shortages of the highly specialized parts, already in tight supply before the March 11 earthquake in Japan. Japanese and North American automakers could face production shutdowns if the pipeline runs dry.

Renesas will move production from its Naka plant, which built 25 percent of its chips, to one plant in Singapore and one in western Japan. The transfer could take up to two months. The Naka plant won't resume partial operation until July.

And the manufacturing process for microchips can take up to two months, meaning it could be four months before those new sites are shipping finished products.

A modern vehicle uses 30 to more than 100 microchips, essential in such things as parking brakes, engine control units, entertainment systems, stability control and power steering. They are highly complex and often use-specific, which means they can't easily be re-sourced.
"The situation is quite difficult," says Matteo Fini, a senior analyst for the consulting firm Supplier Business, a division of IHS Automotive. "I see too many problems trying to replace these devices."

For example, each engine control unit is designed to match the characteristics of a particular powertrain. Microcontrollers are designed to run on a variety of voltages. Automakers use different programming languages, and the computer chips may have a different number of connecting pins. "It's a fragmented universe," Fini says.

And rival chip makers such as Freescale Semiconductor, Infineon Technologies and Texas Instruments cannot easily step up production.
Electronics suppliers such as Robert Bosch GmbH already were scrambling to bolster lean inventories of computer chips. The earthquake "has not made this critical situation any easier," says Bosch spokeswoman Cheryl Kilborn.

The situation is especially difficult for Toyota Motor Corp., Renesas' biggest end user. It is estimated that 80 percent of the microchips in the Lexus LS 460 come from the Japanese chip maker.
Robert Young, Toyota's purchasing chief in North America, declined to comment on specific suppliers. But in an e-mailed response, he confirmed that Toyota is "concerned about the global supply of electrical components."

Indeed, Toyota is worried about a long list of components, not just computer chips. It has 217 Tier 1 suppliers in Japan. As of Friday, its surveys of Tier 1 suppliers had identified 150 components whose supply could not be guaranteed.

A trend soon emerged: Electronics parts -- including wafer boards, connectors and electric wire -- were a big worry.

Toyota Motor Corp. said Friday that it will resume limited assembly at all 18 domestic plants from April 18-27, after more than a month with all but two factories offline.

Toyota was the last automaker to announce it would restart all its plants after the earthquake. But its race to come to grips with its supply chain problems underscores the challenges faced by all of Japan's automakers as they fight to restore full production.

When a supplier was identified as sourcing from an at-risk parts maker, Toyota urged the supplier to visit the subsupplier and hammer out problems. It even provided contact information.

But some factories were closed and turning away visitors, said one supplier executive. "All you could do is take a picture of you at the plant to show Toyota you tried," he said.

Meanwhile, switching to a new Tier 2 supplier is easier said than done. Doing so often requires Tier 1 suppliers to submit process change requests or design change requests to carmakers that can take up to several weeks for approval in complicated cases.

And some parts are unique, so no replacements exist. Finding a new supplier for the complex computer chips that control engines or infotainment systems "tends to be quite messy," Fini says. "I think Renesas' customers will try to stick with Renesas as long as it says it can supply the parts."
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Old 04-11-2011, 10:34 PM   #2
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so 10% of total global automotive supply is impacted?
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Old 12-29-2021, 11:38 AM   #3
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What Happened With the Semiconductor Chip Shortage—and How and When the Auto Industry Will Emerge

https://www.motortrend.com/news/auto...sons-solution/
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Old 12-29-2021, 11:54 AM   #4
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The shortage cost the global auto industry about $210 billion in lost revenue in 2021
Quote:
The world will have lost 11.3 million units of production in 2021 because of the chip shortage
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The impact could be another 7 million units in 2022 and 1.6 million in 2023
crypto to the rescue!
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Old 12-29-2021, 11:59 AM   #5
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Best indicator?
Drive by a dealership. How many new units are on the lot?
Look at the price of used cars, particularly 4 years or less in age. Are they on the high end/higher than KBB?
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Old 12-29-2021, 12:49 PM   #6
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Originally Posted by Elbert Bass View Post
Best indicator?
Drive by a dealership. How many new units are on the lot?
Look at the price of used cars, particularly 4 years or less in age. Are they on the high end/higher than KBB?
KBB is no longer relevant. Quotes from Carvana and Vroom are usually way higher and you can use those quotes to negotiate with your local dealer for trade in. That's what I did.
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Old 02-01-2022, 06:30 AM   #7
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Default Lexus global sales fall just short of all-time record in 2021

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Lexus global sales fall just short of all-time record in 2021, despite chip shortage
Hans Greimel
TOKYO -- Lexus' worldwide sales climbed 6 percent in 2021 and fell just shy of an all-time high, despite inventories being crimped by the global semiconductor shortage.

In detailing full-year results on Tuesday, Toyota Motor Corp.'s premium brand said overall volume increased to 760,012 vehicles in 2021. North America topped the regional charts, with sales up 12 percent to 332,000 units on robust deliveries of the RX and NX crossovers and ES sedan.

In the U.S., Lexus finished third in the luxury sales race, behind No. 1 BMW and runner-up Tesla.

China was Lexus' second-biggest market, reporting a 1 percent increase to 227,000 vehicles. The China results were an all-time high for Lexus in the world's biggest auto market.

European sales notched a 2 percent increase to 72,000 units.

Lexus' global electrified sales rose 10 percent to an all-time high of 260,000 vehicles. But the brand's only battery electric offering, the UX300e, chipped in just 5,800 units.

Hybrids still did the heavy lifting for the premium brand, as did crossovers. The Lexus crossover range booked sales of 495,664 vehicles, for about 65 percent of worldwide volume.

The overall global tally was the second-highest annual result for Lexus and came despite tight inventories triggered by the global semiconductor shortage. The 2021 finish could not quite match Lexus' all-time sales record of 765,330 units booked in 2019 before the pandemic.

If supply and inventories had not seized up the second half of 2021, Lexus likely would have notched a new record last year, spokesman Norihiro Tsuji said in a briefing on Tuesday. And assuming smoothed-out supply in 2022, Lexus aims to top 2021's results in the new year, he added.

"We utilized inventory in the U.S. fully, with inventory getting lower, there was still leftover demand for Lexus," Tsuji said. The Lexus brand's U.S. inventories dropped to 22 days as of Jan. 1, down from 23 days a month earlier and down from 29 days a year earlier.

To tease the brand's all-electric future, Lexus also released new photos of the RZ450e Prototype, which previews the brand's upcoming midsize electric crossover.

The shots show a sleek crossover with a pinched rear-end, steeply raked rear window and wrap-around taillights emblazoned with the brand name Lexus spelled out in all-caps.

In the front, a curving fender crease spins off the front wheel well and peels down along the side of the car, finally melding into a distinctive sheet-metal kink under the C-pillar. The hood bends low for a planted stance, and the wheel arches get black cladding that lend a more rugged look.

The brand's trademark spindle grille gets filled in for a solid look to telegraph the EV drivetrain.

Lexus said it will unveil the production version this spring. Tsuji declined to give a start of sales date, but the vehicle is expected to hit showrooms in late 2022 or early 2023.

Lexus plans to be an electric-only brand by 2030 in Europe, U.S. and China, by which time it aims to be selling 1 million EVs annually. The brand will sell only full-electric cars globally by 2035.

Among Lexus's premium rivals, Mercedes-Benz lost the global premium sales crown to BMW in 2021 for the first time in five years, after Mercedes was hit harder than its German rival by chips shortages. Sales of BMW-branded cars rose 9 percent to a record 2.2 million globally last year, BMW said on Jan. 12.

Deliveries of Mercedes cars fell 5 percent to 2.01 million as a lack of semiconductors delayed the supply of vehicles despite strong demand, parent Daimler said on Jan. 7.


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Old 02-03-2022, 11:04 AM   #8
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It's not just chips in short supply buy many other parts from Canada and Mexico or Asia now. Bearings bolts and semi finished parts
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Old 02-03-2022, 12:09 PM   #9
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Food chain. Less cars being produced for one thing means less of all the other things going into the car. Can't keep the lights on when there's nothing to make.
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Old 02-03-2022, 12:24 PM   #10
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Funny thing is, the dealers at the complex I work at had record profit years the last 2 years, and the company that all these dealerships are under had the same. But still less than half what we'd normally see for inventory over the last 2 years.
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Old 02-03-2022, 12:34 PM   #11
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The available chips (and other parts) are most likely going to higher profit models and trims. This is partially being reflected in higher transaction prices in new cars.
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Old 02-03-2022, 05:30 PM   #12
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Originally Posted by shankmeyster View Post
Funny thing is, the dealers at the complex I work at had record profit years the last 2 years, and the company that all these dealerships are under had the same. But still less than half what we'd normally see for inventory over the last 2 years.
Makes sense, better profit to sell one car for $4k over MSRP than 3 cars at $500 over invoice.
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Old 02-03-2022, 07:21 PM   #13
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Makes sense, better profit to sell one car for $4k over MSRP than 3 cars at $500 over invoice.
Yeah and it makes sense since price gauging is totally acceptable and not a problem at all as it doesn’t create inflation like raising minimum wage and stuff…..ohh wait…
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Old 02-03-2022, 11:29 PM   #14
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Yeah and it makes sense since price gauging is totally acceptable and not a problem at all as it doesn’t create inflation like raising minimum wage and stuff…..ohh wait…
Price gouging is when you're overcharging for necessities. If you're overcharging for a fancy new BMW SUV, that's called a freemarket.
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Old 02-04-2022, 08:47 AM   #15
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Price gouging is when you're overcharging for necessities. If you're overcharging for a fancy new BMW SUV, that's called a freemarket.
You’re right, because cars aren’t a necessity for people in this country thanks to the wonderful investment in public infrastructure and thus great availability in public transportation. Plus, RAV4s being sold at like 80-90K is also called the free market as they’re luxury items like a BMW. Ohh you know what else is the free market overcharging for fancy luxury? Ohh I don’t know things like healthcare and medicine and housing. Hahaha what a joke

Last edited by mcarb002; 02-04-2022 at 09:07 AM.
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Old 02-04-2022, 02:47 PM   #16
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Originally Posted by VarmintCong View Post
Makes sense, better profit to sell one car for $4k over MSRP than 3 cars at $500 over invoice.
Yeah, I have speculated since this 'chip shortage' happened, that we will never go back to the old model of dealers having 500 cars on the lot and relying on bulk sales to make money. That is not going to happen. If they can make equal money only having 100 cars on the lot, the benefits to the dealer mean less employees and less overhead. Profit stays the same or goes up if they can get MSRP for cars. They are all drastically overpriced from the dealer.

I think the days of 15000 dollars off sticker on trucks is LONG gone and are never coming back.
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Old 02-04-2022, 03:33 PM   #17
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Yeah, I have speculated since this 'chip shortage' happened, that we will never go back to the old model of dealers having 500 cars on the lot and relying on bulk sales to make money. That is not going to happen. If they can make equal money only having 100 cars on the lot, the benefits to the dealer mean less employees and less overhead. Profit stays the same or goes up if they can get MSRP for cars. They are all drastically overpriced from the dealer.

I think the days of 15000 dollars off sticker on trucks is LONG gone and are never coming back.
I think we will see some form of higher inventory and incentives come back, the compounding part of the chip shortage is the act of dealers buying used cars to fill in the gap of lower priced new models/trims that are in short supply.

The model of buying cars at MSRP is an effective model but all it takes are a series of compounding events to occur to reverse course. On a large scale, all it can take is one manufacturer to ramps up production on lower cost trims and models. This is a likely scenario as the cost of new cars are increasing at a rapid pace, and soon you will have less new consumers because they can't afford it. So a market opens for lower cost new models/trims. Once consumers purchase these, then used car prices drop because consumers would rather buy new than used. As prices drop for used cars, people are buying used again and now dealers have high priced models/trims sitting on lots not moving.
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Old 02-04-2022, 04:07 PM   #18
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Originally Posted by subyski View Post
I think we will see some form of higher inventory and incentives come back, the compounding part of the chip shortage is the act of dealers buying used cars to fill in the gap of lower priced new models/trims that are in short supply.

The model of buying cars at MSRP is an effective model but all it takes are a series of compounding events to occur to reverse course. On a large scale, all it can take is one manufacturer to ramps up production on lower cost trims and models. This is a likely scenario as the cost of new cars are increasing at a rapid pace, and soon you will have less new consumers because they can't afford it. So a market opens for lower cost new models/trims. Once consumers purchase these, then used car prices drop because consumers would rather buy new than used. As prices drop for used cars, people are buying used again and now dealers have high priced models/trims sitting on lots not moving.
sound reasoning. Will be interesting to see how it plays out.
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Old 02-04-2022, 06:37 PM   #19
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You’re right, because cars aren’t a necessity for people in this country thanks to the wonderful investment in public infrastructure and thus great availability in public transportation. Plus, RAV4s being sold at like 80-90K is also called the free market as they’re luxury items like a BMW. Ohh you know what else is the free market overcharging for fancy luxury? Ohh I don’t know things like healthcare and medicine and housing. Hahaha what a joke
Well, the market stops being free when the government shuts down the economy and then hands out trillions in cash.
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Old 02-05-2022, 08:38 AM   #20
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Well, the market stops being free when the government shuts down the economy and then hands out trillions in cash.
But I thought BMW luxury price hike was the free market? So which is it? Oh I see, when it doesn’t fit your narrative: healthcare, medicine, housing, food—not free market it’s the gubmit’s fault as there’s no freedom. Got it.

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Old 02-05-2022, 10:41 AM   #21
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Originally Posted by SCRAPPYDO View Post
Yeah, I have speculated since this 'chip shortage' happened, that we will never go back to the old model of dealers having 500 cars on the lot and relying on bulk sales to make money. That is not going to happen. If they can make equal money only having 100 cars on the lot, the benefits to the dealer mean less employees and less overhead. Profit stays the same or goes up if they can get MSRP for cars. They are all drastically overpriced from the dealer.

I think the days of 15000 dollars off sticker on trucks is LONG gone and are never coming back.
So, dealers are clearly making more since they are not moving from MSRP much, if at all. Each model year a manufacturer will increase the costs; but, at least what I've seen with Subaru, it's just a couple/few hundred dollars. Not nearly as much as a dealer gets at MSRP(or more if they're doing that); so, wouldn't the manufacturer need to get more cars out for them to increase income? Yeah, dealers are reporting some good years; but, are the manufacturers reporting the same % increases?
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Old 02-05-2022, 11:04 AM   #22
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. Ford to suspend or cut output at 8 of its factories due to chip shortage
https://www.reuters.com/business/aut...source=twitter

Good job Ford. Their earnings were terrible they missed on the top and bottom line.
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Old 02-05-2022, 04:27 PM   #23
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But I thought BMW luxury price hike was the free market? So which is it? Oh I see, when it doesn’t fit your narrative: healthcare, medicine, housing, food—not free market it’s the gubmit’s fault as there’s no freedom. Got it.

Do me favor please Varmit, please..Don't respond.. let the dust settle..
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Old 02-06-2022, 02:37 AM   #24
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https://www.mbtmag.com/quality-contr...rs%20by%202020.

I thought this was an interesting read. Minus the age of it of course. I think i can find more up to date research.

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Tanaka believe that semiconductor IC components in EVs will be double that of conventional gas-powered cars by 2020.
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Old 02-06-2022, 07:04 AM   #25
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Do me favor please Varmit, please..Don't respond.. let the dust settle..
You got it bro.

Friend at a Honda dealer said it’s getting worse, they got only 10 new cars in January.
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