Toyota was one of the few (only?) companies to keep a large stockpile of chips on hand to continue production in case of a supply interruption. They kept something like two years worth on hand.<p>I guess 18 months of doing the extremely heavy lifting for the whole industry has taken its toll and now they're in the same boat.
If you have a taste for irony, my company makes critical components for semiconductor equipment. If we can't ship, equipment companies can't ship new equipment. If they can't ship, semiconductor fabs can't increase capacity to meet the demand and solve the shortage.<p>We went line down last week due to shortage of a chip for our component.<p>In reality, the shortage is somewhat self-inflicted, like toilet paper a year ago, but for whatever combination of real demand + hoarding, we can't get chips.
The article (and others about this topic) indicate that the chip shortage isn't just a static. They all claim that chip and other supply chains (all based on South East Asian) are all under new pressure from delta strain spread.<p>In fact, I wonder how much of this really is chip supply vs general supply. Most articles on this open with headlines about chip supply, but then contains quotes from Toyota about "supply" and "parts" in general.
So new cars are going to be come more expensive due to supply limitations and in turn used cars will continue to become more expensive as they can rise to a certain % of the new car price. At the same time housing prices continue to sky rocket. Seems like not a great time for someone just stepping into adulthood and financial responsibility.
Many countries have a funny concept of strategic industries.<p>In mine, dairy is a strategic industry that is coddled by government so that we can have a local source. But every country thinks that so there’s foes and allies that can supply us UHT or powder milk on a moment’s notice. And if our milk supply disappeared tomorrow, everyone over 1y could substitute with 10000000 different things for nutrition.<p>Cars are another. Every country props up its auto industry, so why worry about a domestic supply?<p>Meanwhile, there are critical components, pharma ingredients or other inputs built in 1 factory in a country we could likely end up in a big dispute with.<p>Just goes to show that industry protection has nothing to do with risk/dependence on that product, and everything to do with picking and choosing which industries are important voting bases.
Come on, we all know this problem and we all know the solution. It's probably red-circuits that we are talking about here. We've all been there: you have your yellow belts full of green-circuits, but the red ones are just so much more complex. You need to set up the entire oil production chain for that, which is tedious and you probably rushed it just 'get a few red circuits so I can get my electric furnace'...<p>I say, take a step back, take some time and really automate plastic-bar production (yes, even the oil wells and refineries, and don't just put rocks in a container, belt them over there like a grown-up)<p>Only after producting enough for a full red belt, should you continue expanding into other branches, like robots and faster belts.<p>Don't they teach this stuff anymore?
Crazy idea: make cars that don't rely on microchips and software. As a bonus, they'll probably last longer, be cheaper to repair, and won't distract drivers as much.<p>There is software in too many consumer goods, usually with very little benefit to the end user, beyond marketing and being able to justify a higher price tag (oooh, it's a "smart" toaster). I don't need the Toyota equivalent of an iPad on my dashboard.
Here in Toronto, Canada:<p>One fallout of this is the rise in prices of old / used cars. To give you an idea, a 2018 Toyota/Honda minivan is Canadian dollars 10,000 higher than pre-covid times.<p>It's ok for folks who have a newish car and want to buy another used car as their current car prices would have increased. But if you are like me, who drives a 15+ year rusty old car and is desperate to buy a 3-4 year old car, then good luck. Not only are the prices much higher (and your car's value is junk) but at the same time, inventory (even for used cars) is super low.<p>I would have loved to live in a City / Country where car is not necessary but this city I live is built for cars...<p>Purely as a joke:<p>Maybe car manufacturers should revive the production lines to produce 1980s Toyota Cressidas, Camrys and Chevy Impalas.
What are the barriers here? As sophisticated as automobiles have become I don't see them needing bleeding edge 5nm fabs.<p>My bigger question is: Why is there not a thriving "small business" chip fab industry?
As a chip supplier, I'd be feeling a lot of pressure right now. In the short term you can squeeze and the tail can wag the dog for a bit. But longer term this opens the door wide open for new competitors in the market and / or vertical integration.
"Porsche will provide cars with ‘fake chips’ to reduce delivery times"<p><a href="https://news.ycombinator.com/item?id=28042518" rel="nofollow">https://news.ycombinator.com/item?id=28042518</a>
I wonder if there will be a long term shift in supply chains toward less "asset light" and more vertically integrated operations with sourcing moved closer to end market demand.
It seems that primary problem isn't chip shortage but other parts shortage made in Asia.<p><a href="https://asia.nikkei.com/Business/Automobiles/Toyota-to-cut-global-output-40-in-September-on-ASEAN-outbreaks" rel="nofollow">https://asia.nikkei.com/Business/Automobiles/Toyota-to-cut-g...</a>
I was speaking to a car dealer client the other week and heard some funny stories, like selling off cheap batches of vans with various non-essential electronics missing - just holes in the dash - and the promise that units would be available to fit later.
On one hand, Toyota buys so many chips that their supplier will probably prioritize their orders.<p>On the other hand, Tesla is tiny compared to Toyota but is probably more flexible and can adapt faster, e.g by using alt chips with new firmware and by using fewer chips per vehicles (to be proven, but we know Model Y has half the number of ECUs of Mach E / ID.4 for instance).<p>Also, without dealers, Tesla could better manage their build-to-order system and pricing (to push customers towards high margin vehicles and forgo volume growth while the shortage continues)
I don't see this raised anywhere -- but what's so bad about producing fewer cars (the poor neglected shareholders and exec bonuses aside)?<p>It's almost as if we would need to lean into this, reducing growth and producing fewer cars would be in line with efforts to mitigate the drivers of climate change.<p>What if car manufacturers pivoted their KPIs and focused on making long-lasting, serviceable vehicles? Toyota is already the worldwide leader in these, as evidenced anywhere that's not smoothly paved suburbia-land.
Can someone explain to me why this wasn't the case before covid? Are the companies who are ahead of the automakers "in line" ordering more than before covid?
Ordered a Yaris Hybrid in June.<p>Still no info on the order, except that the factory in France is on shutdown in August till the 23rd. Except:<p>> Until now, Toyota had managed to avoid doing the same, with the exception of extending summer shutdowns by a week in France<p>Which means it reopens in September...<p>> Toyota is to slash worldwide vehicle production by 40% in September because of the global microchip shortage.<p>Oh boy. Hopefully my order is in one of the first in the queue.
> Taiwan Semiconductor Manufacturing plans to build new factories in the US and Japan<p>I can't help but think that this massive shortage is setting up and equal an opposite reaction 2-3 years down the road: a glut as all this new capacity comes online. Especially given that because companies are now scrambling for chips, they're likely to over-order to ensure future supply.
There is a lot of scalping going on. I keep an eye on certain parts and as soon the stock comes up, it disappears within minutes. Then you can buy all those chips on AliBaba at 10 times the price.
I think government should look into that as this is a huge problem for many businesses.
I looked for a simple non-electronic car recently to buy, and found out that the government has mandated numerous safety systems requiring electronics like backup cameras, no seatbelt alarms, blind spot monitoring, lane assist etc, and in the upcoming infrastructure bill there is a rider to add breathalyzers to every new car made in America. (ref below)<p>Is there an officially designated cost/reduced risk ratio that policy makers can go by to determine if a regulation is worth while?<p>Is a regulation that costs 1 billion dollars to save 10 lives at 100 million a life considered worthwhile?<p>Is a regulation that costs 1 billion dollars to save 1 million lives at a cost of 1000 a life worthwhile?<p>Is there even an officially designated cost per life saved for new safety regulations?<p>If not it seems like a slippery slope, and the government can never overreach as long as it can justify the regulation by saying it saves a single life.<p>Reference:
<a href="https://time.com/6086981/bipartisan-infrastructure-bill-breathalyzers/" rel="nofollow">https://time.com/6086981/bipartisan-infrastructure-bill-brea...</a>
@kliment had a pretty good summary on this:<p><a href="https://news.ycombinator.com/item?id=26931498" rel="nofollow">https://news.ycombinator.com/item?id=26931498</a>
What are these chips and what is preventing us from scaling up capacity? I’m not challenging that it’s difficult, but the reporting seems shoddy. Maybe I’m the only one who wants to understand this stuff, but these kinds of questions always seem obvious to me (same with COVID vaccine manufacturing).
Does anyone know the particulars of the shortage? Talking more about the commodity chips. Very hard to get anything from TI, ST or Microchip. Which fabs and nodes are specifically overloaded?
As Taleb likes to say, an efficient system is the opposite of a robust system, kind of by definition.<p>We are now witnessing the effects of our modern hyper-efficient just-in-time global manufacturing system.
Can someone explain, why this is not reported as in what inflation looks like ?<p>when Supply cant meet demand we get higher prices, what am i missing here ?
Has anyone considered redesigning the car to not need these particular chips?<p>Do a massive push to target a different chip or even a FPGA. There must be something out there to run the software.
Good! Toyota has been sabotaging clean cars because they can't compete [1][2].<p>Most well known car brands have great electric cars now, but Toyota and their oil lobby buddies are trying to halt the progress. The decline of Toyota sales is good news for the world.<p>[1] <a href="https://www.nytimes.com/2021/07/25/climate/toyota-electric-hydrogen.html" rel="nofollow">https://www.nytimes.com/2021/07/25/climate/toyota-electric-h...</a><p>[2] <a href="https://insideevs.com/features/524481/toyota-hybrid-pioneer-delaying-evs/" rel="nofollow">https://insideevs.com/features/524481/toyota-hybrid-pioneer-...</a>