Chip Shortage Expected to Cost $210B
Sept. 24, 2021—A new economic forecast paints a grim picture for automakers amid the ongoing semiconductor chip shortage.
Consulting firm AlixPartners on Thursday released a report that suggests the shortage could cost the auto industry upward of $210 billion according to the Detroit Free Press, almost double the $110 billion the firm projected in May.
“Of course, everyone had hoped that the chip crisis would have abated more by now, but unfortunate events such as the COVID-19 lockdowns in Malaysia and continued problems elsewhere have exacerbated things,” said Mark Wakefield, global co-leader of the automotive and industrial practice at AlixPartners in Southfield.
The firm projects the shortage will cause automakers to lose production of around 7.7 million vehicles for the year. GM officials earlier this month warned of a challenging third quarter due to the ongoing shortage.