Supply chain issues always make it difficult to build the number of cars the world is used to, but believe it or not, the trend is reversing. It certainly doesn’t happen overnight, but gradually automakers are making more and more vehicles, slowly approaching pre-pandemic levels. Promising news on this front comes from Japan where, as Reuters reports, auto production saw a massive 43.1% increase in November from the previous month.
A recovery was expected as the new year approached; Even still, Japan’s increase in November is 7.2 percent higher than expected. It also follows a 1.8% gain in October and comes ahead of the expected increases in December and January. The pandemic could put the brakes on this recovery, but the signs of exiting the world’s third-largest economy still look good.
All of this is happening as automakers like Subaru are experiencing some of their worst selling trends in decades. Likewise, Toyota accepts imperfect parts for its vehicles in an effort to keep production running. The automaker will also be closure of five factories in Japan in January due to various shortages, so while this increase is significant, it’s not like everything is back to normal.
Reuters speculates that as long as the auto industry relies on a greater amount of simpler chips in its vehicles as opposed to fewer more advanced units, these shortages are likely to continue. And reworking an entire vehicle’s systems to work with less semiconductors is not a short-term solution. Needless to say, the solution to this chip shortage problem is complicated, and even with a few automakers like Hyundai, Ford, and General Motors indicating they want to make their own chips, it will likely take even longer to get back to normal. than anyone.
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