The Automotive Industries Component Shortage Crisis
“Everywhere You Look, the Global Supply Chain Is a Mess”. This was the headline of the Wall Street Journal last month as it reported on the supply chain woes affecting all industries across the globe. However, no market seems to be experiencing such catastrophic disarray as automotive.
The chips are down in the Automotive Industry
The electronic chip crisis has now reached a fever pitch in automotive, so much so that the US industry has asked for the Biden administration’s help in mitigating the shortage. Many of the top OEMs have already been forced to extend plant closings, with Forbes reporting that this could reduce production by more than 1 million units this year alone.
Despite this current supply chain, “mess” many organisations have managed to rise to the challenge. The automotive industry’s unlikely knight in shining armour comes in the form of the electronic distributor, with OEMs and their EMS providers turning to the distribution channel to source their components. As discussed by Electronics Sourcing, electronic distributors are experiencing “sharp increases in demand by automakers, their key systems suppliers and contract manufacturers” fuelled by the current semiconductor shortage crisis.
The sceptical may argue that this rush in demand will only curtail once the dust settles. However, as Electronic Sourcing rightly retorts “there is a paradigm shift occurring and automotive OEMs will continue to use the distribution channel even after shortages abate”. Indeed, technology such as advanced driver assistance systems, connected vehicles and electronic energy promise significant growth potential in the automotive electronics industry which will no doubt have a colossal impact on the supply chain as it stands today.
How can Retronix help?
At Retronix, we are in a unique position that we can help all levels of the automotive supply chain through their current component sourcing woes. No matter if you are an OEM, supplier, or distributor our safe and reliable Component Reclaim service can resolve your obsolescence issues. Our wide range of services to the electronics industry allows us to offer a complete package for both the reclaim and reuse of components.
Component reclaim across all sectors of our customer has been our fastest growing service in the last 3 years.
So much so that over the last 18 months alone, we have reclaimed an estimated 3 million components saving an estimated £10M for our customers and helping them avoid allocation, obsolescence, and long lead time issues.