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Infineon warns of car production cuts

While profits may be booming at Infineon, and revenues have soared, the company has warned that the on-going chip shortages bedevilling the automotive industry could cut car production by 2.5 million in the first half of 2021.

“There are roughly 1.5 million cars not being built in the first quarter, and 1 million vehicles not being built in the second,” Chief Marketing Officer Helmut Gassel said in a call with analysts. “That’s, we think, the best estimate that currently exists.”

With profits of €470m and revenues of over €2.7 billion the German semiconductor manufacturer said that the ongoing supply chain shortages were having a real impact on the car industry.

Automakers have been struggling to obtain chips after cutting back orders when the pandemic first hit, and now that demand for both consumer-electronics companies and cars has surged back, companies like Infineon are having to ramp up supply. However, the sector continues to face bottlenecks in a manufacturing supply chain that’s running flat out.

“The semiconductor market is booming,” according to Reinhard Ploss, chief executive officer of Infineon, but warned of “bottlenecks in those segments where we depend on chips supplied by foundries, especially in the case of automotive microcontrollers and IoT products.”

Author
Neil Tyler

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