$1T Infrastructure Bill — the breakdown
What’s happening: Manufacturers struggling with a shortage of semiconductor chips are finding workarounds -- redesigning products, shipping uncompleted units and focusing on older, lower-tech models.
Some background: The chip shortage is caused by issues at all stages of production: Basic building-block materials such as substrates are in short supply. Bad weather and natural disasters have interrupted wafer production. The final stages of manufacturing have been slowed by virus outbreaks and factory closures in Malaysia, a major semiconductor packaging hub. Some examples of older products and reduced feature-sets include:
BMW removing touchscreen functionality across various 3, 4, and X models.
Huawei using a mix of less advanced and powerful chips in its P10.Polaris shipping some snowmobile models without GPS screens.
Cadillac eliminating the Super Cruise hands-free driver assistance technology from the Escalade SUV.
Boss Products switching from a handheld smart-controller to a more analog joystick for their snow-removing machines.
GM removing the HD radio option from its audio systems, and removing many of the heated and ventilated seats.
Mercedes-Benz eliminating wireless phone charging pads, hands-free rear access systems, and some LED headlights (AMG models hit particularly hard).
Porsche removing the 18-way adjustable seat option from the Macan SUV.
Dive Deeper:
The automotive industry accounts for 37% of all semiconductor demand in Europe, and they’re lobbying hard for on-shoring more of the supply chain.
Malaysia, a country with just over 30M people, accounts for 7% of the world’s semiconductor trade and 13% of the global OSAT (test) market.
Some background: The chip shortage is caused by issues at all stages of production: Basic building-block materials such as substrates are in short supply. Bad weather and natural disasters have interrupted wafer production. The final stages of manufacturing have been slowed by virus outbreaks and factory closures in Malaysia, a major semiconductor packaging hub. Some examples of older products and reduced feature-sets include:
BMW removing touchscreen functionality across various 3, 4, and X models.
Huawei using a mix of less advanced and powerful chips in its P10.Polaris shipping some snowmobile models without GPS screens.
Cadillac eliminating the Super Cruise hands-free driver assistance technology from the Escalade SUV.
Boss Products switching from a handheld smart-controller to a more analog joystick for their snow-removing machines.
GM removing the HD radio option from its audio systems, and removing many of the heated and ventilated seats.
Mercedes-Benz eliminating wireless phone charging pads, hands-free rear access systems, and some LED headlights (AMG models hit particularly hard).
Porsche removing the 18-way adjustable seat option from the Macan SUV.
Dive Deeper:
The automotive industry accounts for 37% of all semiconductor demand in Europe, and they’re lobbying hard for on-shoring more of the supply chain.
Malaysia, a country with just over 30M people, accounts for 7% of the world’s semiconductor trade and 13% of the global OSAT (test) market.
