Microchip shortages have been affecting all of us in the automotive industry. We value fast order times and delivery for our customers, but the reality is that shortages can create unfortunate delays in the process. Reading the information below may help shed some light on why microchip shortages are delaying your vehicle order. We love to work with each and every one of you here at Sherwood Ford, and we’ll continue working to help you find a vehicle as soon as possible. Visit us in Sherwood Park to view our currently available vehicles.
The automotive industry accounts for roughly 10% of the semiconductor microchip market. Other uses for these chips include home entertainment systems, video game systems, cell phones, and appliances. Due to people working from home and wanting more home entertainment in recent years, demand for this product is high.
Some of you may be wondering why they can’t just pull a microchip from a vehicle ordered after your vehicle. After all, first come, first served. However, the problem is more intricate than that. A single truck can have about 1,500 microchips total in its various electrical components. These microchips are not all the same, and the shortages impact quite a few of them.
A single microchip order life cycle is as long as 26 weeks. In other words, it can take six months to produce a microchip. Of course, more than one is being produced at a time, and the question is still valid: Why isn’t microchip production being increased? Well, it costs a lot of money to increase production or add new facilities. Four new microchip plants are being constructed in Texas, but they cost billions to make and take years to build, with microchip production at these plants not expected until 2025 at the earliest.
It’s easier to understand the scope of the issue when you see all the numbers. From how long it takes to make a microchip, to how long it takes to make a microchip factory, the issues are complex. Here’s a rundown of the numbers.
Virtually all parts of a vehicle need microchips. Anything that has an electrical component will need one. This includes power train elements, chassis components, infotainment systems, safety systems, and many of your favorite features such as climate controls, seat controls, Bluetooth, and much more.
If you’re looking to order a vehicle, the reality is that some people are waiting months or years to receive their order. That is not the case with every vehicle, but the microchip shortages, along with other part shortages, have delayed order times. We will work with you to get the vehicle as soon as possible, and we understand your frustration at having to wait.
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