Auto Experts Weigh in on the Semiconductor Shortage
Experts suggest automakers focus their attention on the user experience as they content with the limited supply of computer chips.
Marios Zenios, CEO of Auto EE Solutions and former vice president of engineering for connected cars at Fiat Chrysler, reports vehicles increasingly use more semiconductors. In fact, today’s vehicles use around $500 worth of semiconductors, compared with $300 in 2013, he noted in a recent webinar organized by the Center for Automotive Research in Ann Arbor.
Zenios predicts the current value of semiconductors in vehicles and across the industry will double within five years. The $40 billion automakers now spend annually on chips represents just 10% of the global semiconductor business, he adds.
Electrification, infotainment, ADAS, autonomous driving, the broader use of artificial intelligence and the increasing need for in-vehicle infrastructure communication is driving the need for more chips, he says. Over-the-air software updates also are becoming increasingly important, he says.
But customers want more than just a “computer on wheels” – they want safe, reliable transportation. Thus, he adds automakers would be better off working on improving the overall user experience rather than trying to fix technical issues better left to semiconductor makers.
Jaspi Sandhu, senior vice president for engineering and R&D at HCL Technologies, an information technology company, suggests automakers start working more closely with the semiconductor industry.
Collaboration and wider use of standardized platforms, he says, can simplify and expedite product development for automakers. These measures also can slow or reverse the proliferation of electronic control units in each vehicle.
He stresses that the industry doesn’t need leading-edge semiconductors, they can use chips a couple of generations behind the very latest models used in aerospace. But foundries and packaging companies can devote a larger share of their capacity to automakers and help tweak chips for maximum performance.
When automakers collaborate with the semiconductor industry, it also brings more talent to bear on automotive-related problems, Sandhu concludes.
However, Carla Bailo, president and CEO of the Center for Automotive Research, reminds that the semiconductor shortage continues to hobble the auto industry, raising prices and slowing its ability to rebuild inventories, and asks when it will end.
Zenios predicts the shortage could drag on through 2022 and into 2023, but sees a surplus of semiconductors available to the automotive industry in the latter part of 2023.
He says the auto industry must overhaul its planning and forecasts to gain better insights into the semiconductor business. He stresses the pandemic was a once-in-a-century event but that automakers based forecasts on shrinking demand during shutdowns, leaving them with limited options as sales recovered.