Home Business China’s chip crisis aggravated the production of many car manufacturers halved | BMW Brilliance | FAW-Volkswagen | Automotive chips

China’s chip crisis aggravated the production of many car manufacturers halved | BMW Brilliance | FAW-Volkswagen | Automotive chips

by admin

[Epoch Times September 05, 2021]The chip shortage crisis in China’s auto industry has not only not been alleviated as expected by the industry, but has intensified over time. A number of Chinese joint ventures and local automakers have halved their production for three consecutive months.

China Business News reported on the 4th that a number of automakers said that the new round of chip shortages that have erupted since July has affected the area and the degree of shortages, which are more serious than those at the end of last year and the second quarter of this year. A number of Chinese joint ventures and local auto companies including Volkswagen, Honda, Nissan, etc. have been close to “halved” production for three consecutive months.

One of the bottleneck suppliers of FAW-Volkswagen is Bosch ESP chip.

In mid-August, Xu Daquan, Executive Vice President of Bosch China, announced in the Moments that a certain semiconductor chip supplier’s Muar factory in Malaysia was shut down by the local government last night due to the new epidemic. Part of the production line was closed by the local government until August 21 day. Bosch ESP/IPB, VCU, TCU and other mainstream automotive chips will be directly affected, and it is expected that the supply will be basically out of supply in August.

German Bosch company (Bosch) is China’s largest ESP supplier. Car companies such as BMW Brilliance, FAW-Volkswagen, Changan Automobile and Great Wall Motor mainly use Bosch ESP systems. In late August, an insider of Anhui Chery Automobile told reporters: “Bosch ESP is close to being out of stock.”

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As a leading company in the automotive industry, FAW-Volkswagen has a huge production and sales volume. It mostly chooses large global parts suppliers such as Bosch and Continental for supply. The “core shortage” crisis is the first to show up in these parts suppliers with huge output.

According to data from the Federation of Travel Services, from April to July this year, FAW-Volkswagen’s output decreased by 40.7%, 25.5%, 60.8% and 58.7% year-on-year respectively.

In addition to FAW-Volkswagen, Chinese joint ventures such as Honda and Nissan have also experienced substantial production cuts caused by chip shortages. The latter is mainly affected by chip companies such as Japan’s Renesas. Although the production cut is later than FAW-Volkswagen, the impact is also very serious. The output of Guangqi Honda and Dongfeng Honda in June and July of this year both decreased by more than 40% year-on-year.

A person from Dongfeng Honda said that some of the company’s main sales models have even reduced production by 80%.

Compared with the first half of last year, the current price of China’s auto chips has generally risen by 10 to 20 times, and it is still “difficult to find one core.”

Forced by the “chip shortage”, some Chinese automakers’ executives took turns at the door of chip manufacturers to get the newly produced chips first.

Just last month, in response to issues such as high car chip prices, the CCP’s CCTV Finance issued a warning, stating that core speculators should immediately “stop the precipice” and that the State Administration for Market Regulation “should do it when it is time to do it.” Subsequently, A-share semiconductor chip stocks plummeted.

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Editor in charge: Li Bing


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