Renault has admitted that it is struggling to secure enough semiconductors to continue production without making further cuts to output.
As the shortage of chips continues to impact the automotive industry, Renault chief executive Luca de Meo said that it is a “daily fight” securing the chips the carmaker needs. He added that the shortage could cut Renault’s output for this year by as much as 100,000 vehicles.
The automaker has already started to feel the effects of the shortage and earlier this year idled production at plants in France, Morocco, and Romania, Auto News notes.
Read More: Biden Administration Seeking Taiwan’s Help To Ease Global Semiconductor Shortage
A number of factors have contributed to the semiconductor shortage. Last year, demand for new vehicles fell considerably due to the coronavirus pandemic so car manufacturers reduced orders for microchips. At the same time, demand for electronics including the PlayStation 5, Xbox Series X, and computers for those working from home, skyrocketed. The automotive industry also bounced back from the pandemic much quicker than anyone had expected, triggering the shortage. Things won’t be resolved quickly.
“It will get worse before it gets better,” IHS Markit analyst Phil Amsrud recently said. “Longer term, the automotive industry needs to make supply assurance as high a priority as cost savings.”
News of Renault’s ongoing battle with the shortage comes shortly after it was reported that the Biden administration sought the help of the Taiwanese government to resolve the problem. Taiwan is the world’s largest manufacturer of semiconductors and U.S. automakers are asking the administration to pressure foreign chipmakers to allocate crucial supplies to them.
