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What are semiconductors and why is there a shortage?

What are semiconductors and why is there a shortage?

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Car manufacturers are experiencing a lot of stress on their supply chains because of one simple component - the semiconductor. But what are semiconductors all about and why are they so important? Let’s take a look.

So a semiconductor is used to control parts of a car?

Correct. These ‘chips’ are used in all manner of applications throughout a car, in things such as the infotainment and displays as well as more crucial areas like the power steering and brake sensors. 

Even the reversing camera - a crucial bit of tech for so many drivers - simply wouldn’t work without semiconductors. 


Are semiconductors only used in cars?

Not at all. You’ll find them in all manner of electronic devices, including smartphones and games consoles, which both rely on semiconductors to work properly. 


So why are they in short supply?

A big chunk of the issue comes as a result of the coronavirus pandemic. At the start of the pandemic, fewer people were buying cars and, as a result, manufacturers ordered fewer chips. In contrast, makers of games consoles and phones - which were soaring in demand - were buying up as many as they could in order to meet orders. 

As a result, when manufacturers started to build cars at the same rate as before, they found themselves at the back of a very long queue for semiconductors. 


So how does this shortage impact new cars?

Essentially, the shortage in semiconductors means delays across the board. Several manufacturers including Jaguar Land Rover and Mini have had to slow down production - or stop it entirely, in some cases - to compensate for the chip shortage. As a result, customers will have to wait slightly longer for their new cars compared with usual. 

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