Auto manufacturers, dealers affected by semiconductor shortage
Pandemic, overseas factory fire just two reasons for worldwide shortage
TOLEDO, Ohio (WTVG) - Many things we buy these days have a computer chip in them -- but one small part, and lack thereof, is causing big headaches for assembly line workers worldwide.
Grogan’s Towne Chrysler Jeep Dodge Ram and Charlie’s Dodge are just two of several local auto dealers that are feeling the pinch of a shortage in semiconductors -- small electronic chips that go into each new car or truck by the dozens. They’re hard to produce in a normal year, and the pandemic isn’t the only culprit.
“In Japan, they had a big fire there where a lot of these chips came from,” says Denny Amrhein, president/owner of Grogan’s Towne and Charlie’s. “They’ve been trying to get other people to produce the chip, but it’s not very easy to do.”
Last spring, demand for cars fell as travel did... and consumer electronics took the lion’s share of those chips. Now that automotive demand is higher, manufacturers are quickly trying to make up for lost time. Amrhein speculates that “a lot of people are going out and buying vehicles today who might not be ready for one -- but they’re just so tired of everything that they want to do something, to have some fun.”
Nearly every automaker has been affected by this domino effect of delays. Several plants worldwide have at least partially paused production recently, including the nine-speed line at GM’s Toledo transmission plant. Amrhein says he has about a tenth of his normal stock right now -- and Chrysler’s been mum about their delivery dates to fill the lots again.
“Chrysler, General Motors, Ford... they’re all in the same boat,” he points out. “They just keep saying, ‘They’ll be here, they’ll be here’... well, they’re not here. If anybody would’ve told me that I’d ever have just 20 cars on my lot brand-new, I’d have told them they were really messed up. Even if it looks like we’re going out of business, we’re not!”
The customers who are coming in are generally understanding: “We tell them, ‘Hey, we’ll have this Grand Cherokee, or this Wrangler, but it’ll be 2 to 3 weeks’... people are good with that right now, which is almost strange. It used to be someone’s looking to buy a car within the next day or two if they come out to the store, but I think people understand where most of us are at right now.”
Amrhein recalls last March and April as “two of the worst months ever” for both stores, but says this spring has seen a huge turnaround: “Both Grogan’s and Charlie’s are on target so far to have really good years. Even with the shortage we’ve had, we’ve had a couple of months that were really fantastic months.”
It’s not just the auto industry feeling the effects. Everything from appliances to smartphones and gaming consoles can require several semiconductors, and leaders in those fields are watching and waiting for supply to keep up with demand once more.
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