Following the news from Daimler that a shortage of critical semiconductor components hit deliveries in the first quarter and will further impact sales in the second quarter;

David Leggett, Automotive Analyst at GlobalData, a leading data and analytics company, offers his view:

“Daimler’s warnings today are the latest in a long line of warnings and actions from vehicle companies being adversely impacted by shortages of semiconductor components. Without critical semiconductor components that govern multiple areas of vehicle functionality, vehicles are simply not able to be finished for sale.

“The electronic content in modern vehicles is estimated to account for some 30% of a bill of materials, with the prospect of that increasing to 50% by 2030. As a result, automotive production is as reliant on computer chips as the consumer electronics industry.

“This problem will take some time to fix. Semiconductor wafer foundries are expensive facilities to build and lead times are long – six to nine months is the timeline commonly cited.

“What does the auto industry think? GlobalData asked more than 100 auto industry professionals for their view. Some 47% said they thought the shortages could last until the end of this year while a further 32% said they thought the shortages would last into 2022.

“It’s becoming clear that a short-term fix is increasingly unlikely. Indeed, the problem of semiconductor shortages and subsequent output disruption in the automotive industry could even worsen later in the year as market demand for vehicles rises.”