MUNICH, Nov 26 (Reuters) - Whether buying computer chips
directly from manufacturers, reconfiguring cars, or producing
them with parts missing, automakers are having to get creative
to cope with the global shortage of semiconductors.
The shortage, due to supply problems and a surge in demand
for consumer electricals during the pandemic, has hit the auto
industry hard, with millions of vehicles worldwide not being
produced because important parts are missing.
With the problem lasting longer than initially expected,
manufacturers including Daimler and Volkswagen
have had to rethink production strategies.
Car manufacturers usually buy parts from major suppliers
such as Bosch and Continental, which in
turn buy from suppliers further down the chain.
In some cases that has led to a lack of transparency, said
Ondrej Burkacky, a senior partner at McKinsey.
"There was the fallacy of thinking that you had a choice
between two suppliers, but the truth is that they both had the
chips made in the same foundry," he said.
That is now changing, according to Daimler Purchasing
Manager Markus Schäfer.
The German maker of Mercedes-Benz cars has set up a direct
line of communication with all chip suppliers, including wafer
producers in Taiwan, he said at the IAA auto show in September.
Volkswagen boss Herbert Diess speaks of "strategic
partnerships" his company has entered into with manufacturers in
Chip suppliers need to be treated differently given their
strategic importance to the industry, said Stefan Bratzel from
the Center for Automotive Management.
"You have seen the problems that arise when you treat the
chip companies like other suppliers and stop the calls," he
McKinsey's Burkacky said carmakers should consider direct
investments in production, or longer contracts with terms of
more than 18 months.
"Not much of that has been implemented yet," he added.
In the meantime, vehicle developers are doing their part to
help manufacturers manage the supply crunch.
Annette Danielski, chief financial officer of Volkswagen's
trucking unit Traton, said the company was trying to
clear some space on the motherboards of control systems.
"If we change the software, we can use fewer semiconductors
and achieve the same functionality," she said. "That sometimes
takes a long lead time because the regulatory authorities
intervene, but there are areas where you can change something
Daimler relies on new designs for control units. Rather than
using one specific chip, these are designed to work with an
alternative that can be used in the event of delivery problems,
the company's head of purchasing Schäfer said.
Tesla is considered the model for this.
The company reprogrammed software within three months so
that other less scarce chips could be used, enabling the U.S.
electric carmaker to weather the crisis better than many others.
General Motors has said it will work with chip
manufacturers like Qualcomm, STM and Infineon
to develop microcontrollers that combine several
functions previously controlled by individual chips.
"We are trying to create an ecosystem that is more
resilient, more expandable and always available," a company
Some carmakers are stockpiling - or what BMW calls
The whole car is built except for a missing part, and can
then be completed relatively easily when it shows up.
Other automakers are also using this strategy. Sometimes
vehicles are delivered without certain functions controlled by
Semiconductors are also conserved for high-quality vehicles,
like electric cars, while customers face even longer wait times
for low-priced combustion engines.
That strategy is slowly reaching its limits. Volkswagen
recently had to temporarily stop the production of electric cars
in its Zwickau plant in Germany.
How well these coping strategies work is not yet clear.
"The bill will be presented in mid or late 2022, when you
can see who came out of the crisis well and who did not make it
so well," said McKinsey's Burkacky.
(Additional reporting by Nick Carey
Editing by Mark Potter)