Tesla CEO Elon Musk says new chip factories will end global industry shortage by next year – FutureCar.com

Speaking at a tech event in Italy on Friday, Tesla chief executive Elon Musk announced that the new semiconductor factories currently under construction will provide enough chips to end the global shortage in the industry. automotive industry over the past 18 months. Reuters reported on Friday.

Musk said the new factories will end the shortage by next year and that chip shortages will be “short-term in nature.”

“There are a lot of chip making factories under construction,” Musk said in a joint session with automaker Stellantis and Ferrari president John Elkann at Italian Tech Week in Turin. “I think we will have a good capacity to supply chips by next year,” he added.

Automakers around the world have struggled with the global semiconductor shortage since last year. Earlier this year, the Tesla factory in Fremont was shut down for two days due to what Musk called a “parts shortage.”

On September 3, U.S. automaker General Motors announced it was suspending production at eight North American factories due to continued chip shortages.

Also this month, Japan’s Toyota Motor Corp announced revised vehicle production plans for September and said it was revising its production plans for October due to parts shortages. The company said the shortages are made worse by the spread of COVID-19 in Southeast Asia which has shut down supplier factories.

For the annual production forecast for the fiscal year ending March 31, 2022, Toyota adjusts its expected production volume to 9 million vehicles, down 300,000 vehicles from the 9.3 million units it had. expected earlier.

During the meeting with the two auto executives in Italy, Musk thanked Elkann for the support Tesla received between 2017 and 2019 from Comau, Fiat Chrysler’s robotic unit, which is now part of parent company Stellantis. Musk said the production issues with the Model 3 were the “most painful period in the company’s history.”

The robotic assembly line equipment supplied by Comau was installed at the Tesla factory in Fremont, Calif., And helped the company ramp up production.

“John has helped me a lot during this time,” Musk said, adding that Tesla had come close to bankruptcy “half a dozen times”.

What caused the flea shortages?

The chip shortages can be at least partially blamed on last year’s global pandemic, which caused auto sales and output from electronics suppliers to drop from the second quarter of last year. Production has also been hampered by temporary plant closures due to the pandemic.

The pandemic has also led automakers to cut orders for semiconductors and chips used in vehicle production. At the same time, the demand for chips used in popular electronic devices such as laptops and game consoles has increased as more and more people have been forced to work remotely and spend more time at home. House.

But as auto sales rebounded earlier than expected in fall 2020 and automakers ramped up production and increased chip orders again, leading to widespread shortages for automakers in China. , the United States, Japan and Europe. However, analysts said sanctions against Chinese tech companies also played a role in the shortages.

Recent chip shortages in the auto industry have been called “extreme” and analysts predict auto supply chains will not stabilize until next spring.