Chip shortage expected to cost auto industry $210 billion in 2021

Ford started off resuming vehicle output in the U.S. on May possibly 18, 2020 with new coronavirus protection protocols such as overall health assessments, private protecting machines and facility modifications to improve social distancing.


With no stop in sight this year, the ongoing semiconductor chip lack is now expected to value the international automotive market an believed $210 billion in income in 2021, according to consulting organization AlixPartners.

The forecast is practically double it former projection of $110 billion in May. The New York-centered agency first unveiled an initial forecast of $60.6 billion in late January when the pieces dilemma begun triggering automakers to slice generation at plants.

“Of program, absolutely everyone had hoped that the chip crisis would have abated additional by now, but regrettable events these as the COVID-19 lockdowns in Malaysia and continued issues in other places have exacerbated factors,” Mark Wakefield, world co-leader of the automotive and industrial observe at AlixPartners, said in a statement.

AlixPartners is now forecasting that 7.7 million units of manufacturing will be missing in 2021, up from 3.9 million in its Could forecast.

Automakers throughout the globe, like Ford Motor and Typical Motors, had warned of substantial earnings cuts this year due to the chip shortage. But some, if not a great deal, of all those losses have been offset by resilient buyer need and better profits from document automobile charges.