Based on the current situation in the auto industry, the chip supply shortage is expected to last until January next year, the Beijing News quoted the China Association of Automobile Manufacturers (CAAM) as saying on Wednesday.

The CAAM said that the tight supply of components, including chips, will continue to affect the production pace of car companies, which are expected to be affected more in the second quarter than in the first quarter.

Data released by the CAAM earlier today showed that China's April auto sales were 2.252 million units, up 8.6 percent from a year earlier. A total of 8.748 million vehicles were sold in the January-April quarter, up 51.8 percent from a year earlier.

China sold 206,000 new energy vehicles in April, up 180.3% year-on-year. A total of 732,000 new energy vehicles were sold in January-April, up 249.2% year-on-year.

In early April, Li Shaohua, deputy secretary-general of the CAAM, said he expected the auto chip shortage to last nine months to a year, more pessimistic than the six months he previously expected.

According to him, the impact of multiple factors overlapping led to a concentration of chip supply and demand conflicts during this period, but there is no need to panic.

The Covid-19 led to the automotive industry and the chip industry information mismatch, manufacturers of improper expectations of the future, which led to this chip shortage, Li said.

The tight capacity of 8-inch wafers in recent years is also a chip shortage inevitable factor, he said.

Li believes that because automotive chips account for a relatively small proportion of the overall cost of the car, the shortage of chips will not cause an increase in the price of automotive end products.

The chip shortage provides a very good opportunity for the development of China's local automotive chips, giving manufacturers the opportunity to catch up with foreign companies, Li said.

Auto expert now expects chip shortages to take nine months to a year to ease

China auto association expects chip shortage may last until January next year-CnEVPost

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