Chip shortages will lead 50% of the top 10 vehicle manufacturers to make theirs by 2025

The chip shortage, which seems to have no end in the short and even medium term, is wreaking havoc in various sectors. One of the most affected is the automotive industry, in which many vehicle manufacturers have had to give up integrating certain features in several of their models, and even temporarily stop manufacturing plants due to the absence of semiconductors.

This will lead the sector to take drastic measures, so much so that according to the data that the Gartner consultancy shuffles, and its forecasts, by 2025 half of the top 10 vehicle manufacturers of the world will be designing and manufacturing their own chips. This way they will have more control over their roadmap and supply chains.

Additionally, the ongoing chip shortage crisis is particularly prevalent with technology node devices using mature semiconductors. That is, they are manufactured in smaller wafers, eight millimeters, and at points where the expandability is difficult.

In the case of automotive manufacturers, their own peculiarities when using chips, added to the general situation, have made them suffer even more from its consequences, which may have led them to experience a greater impact from the crisis. So many may have been motivated to internalize their chip design.

Gauray Gupta, Research Vice President, Gartner, highlights that «Automotive semiconductor supply chains are complex. In most cases, chipmakers are traditionally Tier 3 or 4 suppliers for car manufacturers, which means that it often takes time for them to adapt to changes affecting automotive market demand. This lack of visibility in the supply chain has increased the desire of automakers to have more control over their supply of semiconductors.«.

This model of going back to in-house chip design is not unique to this sector, and everything indicates that it will intensify in technology companies, as some changes take place in the semiconductor market.

Manufacturing plants, such as those of TSMC and Samsung, have provided access to state-of-the-art manufacturing processes, and other semiconductor manufacturers have provided access to advanced intellectual property that makes custom chip design relatively straightforward. But also, according to Gupta, «We anticipate that the lessons learned from the microchip shortage will further drive automakers to become tech companies«.

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