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Auto Industry Asks for Government Help with Microchip Shortage

The auto industry is warning that a global semiconductor shortage could drag on for another six months and mean 1.28 million fewer vehicles produced this year. The industry’s largest trade group is asking the U.S. government to help. The shortage has a complex set of causes. Today’s cars contain dozens of microchips that control everything from engine timing to cabin temperature. Early in the COVID-19 pandemic, automakers cut their orders for the chips, anticipating a long period of low demand. Meanwhile, consumers, working and attending school from home during lockdowns, bought millions more laptops, web cameras, and other consumer electronics. This higher demand is using up the available chip supply. As automakers up production to meet rising demand, overwhelmed chipmakers haven’t the capacity to build automotive microprocessors at that level.