Car Industry’s Chip Shortage is Almost Over – Morgan Stanley

The semiconductor microchip crisis has been ravaging the global car industry, forcing numerous carmakers around the world to hack their production figures and enact cost-cutting measures.

Various analysts have said that the crisis will persist and worsen within the next two quarters.

Contrary to these reports, Morgan Stanley (MS) has reported that the microchip shortage issue is almost over for the auto industry around the globe.

Southeast and Central Asian countries such as China, Taiwan, Malaysia, South Korea, and Japan, and the Netherlands, and the United States are among the major producers of microchips in the world.

Recent reports by MS suggest that Malaysia has resumed its production of microchips at 100 percent capacity, and the rest of the manufacturers in Asia will soon follow suit.

Along with the increase in the production from Malaysia in October, the production of cars and cloud data center server shipments are likely to improve as well. These components are likely to bolster the production and sales numbers of car manufacturers in the near future.

MS also reported that the Japanese chip production lines will normalize by December, which will allow for a faster gap fulfillment for the automakers.

However, it is unlikely for the car prices to drop in the future because the chipmakers are expected to quote higher prices for their products as the chips are still a rare commodity in a market that is still recovering from the woes of the pandemic.

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