The Chip Shortage Means 2.2M Fewer Cars This Year So Far
Experts believe that number will soar to over 3 million by the end of the year.
We're nearly halfway through 2022 and the global microchip shortage—as expected—is still wreaking havoc on car manufacturing. Dealer lots are seemingly empty, new car prices are very much being padded by "market adjustments," and hot new models like the Ford F-150 Lightning, Bronco, and Maverick are seldom to be seen. Now, Automotive News reports that these issues have resulted in millions of cars never going into production.
An ongoing industry tally from AutoForecast Solutions (AFS) calculates that the industry is now short more than 2.2 million cars worldwide for the year thus far. This new figure represents an uptick of more than 10 percent from the group's previous year-to-date tally and is a rather grim outlook of what new car buying looks like for the rest of the year.
The majority of the cuts estimated by AFS are from North American assembly plants. Around 88 percent (or 205,200 units) of the 234,200 vehicles added to the tally are cars and trucks that were set to be assembled in North America but have instead reached the cutting room floor rather than a dealer's lot. This brings the total estimated year-to-date shortage of North American-produced vehicles to 780,800 units.
While North American numbers aren't looking great for the year, it actually isn't the hardest hit area in the world. That unfortunate award goes to Europe, which has an estimated production loss of 794,100 vehicles. An additional 107,300 units in China have also fallen victim to the microchip shortage, as have 437,900 in the rest of Asia, 98,200 in South America, plus an additional 12,000 units in the Middle East and Africa.
While 2,230,400 total units have already been cut across the globe so far this year, AFS predicts that the total accumulation will rise to 3,040,861. That may seem like a lot (and it is), but it also signals a bit of a silver lining: the auto industry may now be past the worst of it.
AFS' future predictions note that an additional 810,461 vehicles will fall victim to the microchip shortage this year—that's a hike of around 36 percent compared to the number of units already lost in 2022 thus far. However, it's important to point out that the year is almost halfway over which means product availability should start to see an improvement as shortages ease. This echoes the sentiment made by Ford CEO Jim Farley earlier this year, indicating a potential easing of parts shortages in the second half of 2022.
The largest unknown is whether or not improved availability will help cut down on outrageous car prices anytime soon. While availability does look to improve, there is still a rather large shortage to be recognized that may not improve until 2023 or beyond.