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Why is there a chip shortage? At Ocean Honda of Burlingame in Burlingame, we often get asked that question about the chip shortage in the automotive industry. For questions like, “Why is there a chip shortage for cars?” or “What is the chip shortage?” We have answers for that! Find out how the chip shortage affects you in Daly City.
Currently the world is experiencing a global chip shortage. For customers in new cars in South San Francisco to Palo Alto, feel the impact of the chip shortage daily since it’s in all of technology. The chip shortage for automotives has been steady and on the incline. Now that we’ve answered, “What is the chip shortage?” Well, here is what these chips are.
Sometimes these chips are referred to as microchips or “semiconductors”. These chips are incredibly important because they are the powerhouse of our electronic devices. Things like our phones, fridges, Honda vehicles, all require chips. So, why is there a chip shortage? These chips take time to create, many steps and several days are put into the production process. Right now, the demand for chips exceeds the supply.
Around the world, factories and warehouses have shut down due to the COVID-19 pandemic.While some were totally shut down, some were just closed for a few months. Even with a few months of temporary closures, materials were not able to be used for production. The chip shortage for automotives and everything else has been affected by our global supply chain.
For Honda and other car companies, chips are needed every day for each model. Prior to COVID-19, car companies would order chips in advance. Now, it takes between 6 months to one year to receive a full order of chips. Ports were shut down for weeks and months just like factories were. Hundreds of shipping containers were delayed at docks which led to delays.
Contact us at Ocean Honda of Burlingame to learn more about our finance process! We want you to stay healthy and focus on your health and well being.
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