Under the supply chain crisis, the shortage of chips leads to the shortage of automobile production, especially the production capacity of some middle and high-end cars which are more intelligent. Goldman Sachs slashed its forecast for global car production on Monday.
Goldman Sachs expects global car production to grow 2.3 per cent year-on-year this year, well below expectations at the start of the year, and believes the tight supply and demand situation is expected to continue for several more quarters.
Specifically, Goldman Sachs expects global production of 75 million vehicles in 2021, compared with a previous forecast of 83 million, and 85 million in 2022, compared with a previous forecast of 90 million.
On Thursday, consulting firm Alixpartners said that global carmakers will reduce their car production by 7.7 million vehicles this year, resulting in a total revenue loss of $210 billion, almost double the forecast earlier this year.
Goldman Sachs expects auto industry pricing to remain strong in 2022 because of low inventories and a persistently strong demand environment.
The present situation of the imbalance between supply and demand
On the demand side, with the gradual control of the epidemic and the continuous recovery of the economy, the increasing demand for cars and the global popularity of superimposed electric vehicles, automakers have entered the field of new energy in recent years, and the demand for chips is also increasing significantly.
Goldman Sachs believes that even without supply chain bottlenecks, it may be more difficult for suppliers to meet rapidly growing demand.
On the supply side, on the one hand, the supply chain disruption crisis has intensified in recent months due to a series of tribulations such as shipping congestion, container shortage, sky-high shipping charges and outbreaks in port areas, which has further hindered production capacity.
On the other hand, at the time of the outbreak, some chip and car manufacturers temporarily closed factories and reduced production because of safety concerns and predictions of a recession and falling demand.
When will it be improved?
Judging from industry insiders' outlook for the future, Volkswagen, Daimler and BMW all issued pessimistic forecasts in early September: carmakers are likely to remain "core-deficient" in the coming months or even years.
Last week, a research report released by market analyst Susquehanna Financial Group showed that chip delivery time in August increased by six days from the previous month to about 21 weeks. This is the longest waiting time since the company began tracking data in 2017.
Intel's new CEO Pat Gelsinger is pessimistic about the prospect of global chip supply in the future, believing that the "chip shortage" is expected to last for several years.
Goldman Sachs, on the other hand, is optimistic that the chip crisis will begin to improve later this year.
According to Goldman Sachs, given that it takes about 6-9 months for new machines to be delivered, 1 month for installation and testing, and 2 months for new capacity to go offline, this means that the global supply of chips will increase around the end of the year.
Goldman Sachs also pointed out that chipmakers will give priority to the production of automotive chips. Still, Goldman Sachs admits that full car inventory will not be restored until at least mid-2022.
