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Reasons for the delay in delivery of new vehicles

/ Theme(s): BLOG, Fleet Strategy
Reasons for the delay in delivery of new vehicles

The year 2021 was characterised by long delivery times for new vehicles, among other things. The was due to the shortage of semiconductors. But why are semiconductors needed at all? Why did the delivery bottlenecks occur in the first place? How will things continue in 2022? And how can ALD support you in bridging the delivery times? In our retrospective and outlook, we provide clarity.


What are semiconductors?

Semiconductors are the main component of microchips and thus play a central role in electronics and energy technology. These components have been indispensable in the automotive industry for years. They sit in control units, regulate the drive and the driving or braking behaviour, and control air bags and assistance systems. The increased demand for e-cars has further increased demand because these cars require a particularly large number of electronic parts and thus semiconductors.


How did the semiconductor shortage come about?

At the onset of the COVID-19 pandemic, many car manufacturers cancelled orders with chip makers. As expected, there was a slump in vehicle sales. However, it was not as severe and long-lasting as expected. Demand for new vehicles recovered quickly. At that time, however, the free capacities of the chip manufacturers were already being used for communication and consumer electronics and were thus no longer available to the car manufacturers.

The situation was also exacerbated by unforeseen events. In February 2021, for example, chip manufacturers in Texas had to temporarily halt production because heavy snowstorms triggered widespread power outages. In Japan, several manufacturing plants were severely damaged by fires in March 2021.

COVID-19 also made itself felt in another way. Because of the illness of employees and the resulting quarantines, there were repeated delays within the supply chains.


Why is production not being increased?

One main reason is the lack of capacity. Because of the increase in remote work in many industries, the demand for semiconductors has risen sharply. Resources formerly allocated to the automotive sector are now being used for the production of communication and consumer electronics because of the cancellations. This means that fewer semiconductors are available to car manufacturers. To make matters worse, chip manufacturers need a lead time of six to nine months to switch production to the manufacture of new, complex chips.

Building new manufacturing facilities is not a short-term solution either. Even just the expansion of existing factories can take up to two years. It can take up to four years to build a new factory.


Will there be an improvement in 2022?

This is difficult to predict. However, experts assume that the situation will not improve this year and that the shortage of semiconductors will remain for some time. An expansion of European semiconductor production is therefore necessary in order to be prepared for possible semiconductor shortages. Currently, only about 10% of the semiconductors produced worldwide come from Europe. However, many times that amount is needed.


ALD Automotive is helping!

Do you also have to wait longer for your new vehicle and cannot extend your existing leasing contract? We have the perfect offer: ALD Flex. With ALD Flex, we offer you immediately available vehicles from a term of just one day. Longer delivery times can thus be flexibly bridged at short notice.

Are you an existing ALD customer and affected by delivery delays? Simply contact your customer service. Together, we will find the optimal solution in order to bridge the waiting time for your new vehicle.