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Tiny chips cast big shadow over Munich car show

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As carmakers gathered in Munich on Monday to launch almost exclusively zero- or low-emission vehicles, an ongoing semiconductor shortage cast a long shadow over the first major car show since before the pandemic began.

Forced to shut down plants last year, carmakers now face increasing competition from the consumer electronics industry for chip deliveries. That problem has been compounded by a series of supply chain disruptions during the pandemic.

Cars have become increasingly dependent on chips - for everything from computer management of engines for better fuel economy to driver-assistance features such as emergency braking.

Speaking during the launch of a couple of electric vehicles (EVs) on Sunday evening, Ola Källenius, CEO at premium German carmaker Daimler AG, said that while the company is hopeful its own supply will improve in the fourth quarter, soaring demand for chips means the industry could struggle to source enough of them into 2023 - though the shortage should be less severe by then.

-Reuters -
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