The Road Ahead: Automotive Shipping During a Global Chip Shortage
The global chip shortage continues to impact the automotive industry, primarily causing production disruptions and reducing supply despite steady demand.
A quick recap.
Global supply chain issues began when the Covid pandemic emerged and spread quickly throughout the globe. Resulting shutdowns caused widespread restructuring in every industry. The war between Russia and Ukraine, along with China’s Covid resurgence, perpetuated the chip shortage well into 2022. These factors led to a production decrease for auto producers as data chips required for many technologies diminished significantly in the global supply-chain disruption. While the chip shortage resulted in a rapid decrease in production for auto and auto part producers alike, research suggests the shortage is projected to get better and get worse in 2023.
How can this be, you ask?
The automotive production disruption in 2022 caused a decrease in order fulfillment, and a decrease in order fulfillment quickly caused demand to increase. A 2023 chip increase is expected, however. As a result, an increase and order fulfillment will naturally occur. Now comes the tricky part. Finding a shipping partner that can scale capacity as needed while offering consistent, quick, and reliable turnaround times is the next challenge. Changing gears and exploring how these qualities in a shipping partner will enhance shipping capacity, improve forecasting accuracy, and increase profits for auto producers will provide greater insight.
Recommended by LinkedIn
Agile Shipping Solutions to Scale Auto Freight Capacity
While auto producers rapidly adjust production based on chip availability, the need to scale freight capacity is critical. Despite the increase in chip production, the automotive industry faces yet another obstacle – a supply shortage of semiconductors, a specialized chip specific to automotive producers. While chip availability for other technologies is slowly on the rise, confidence in semiconductor chip availability for 2023 causes concern. The right shipping partner with the resources to scale capacity as needed is essential while navigating the uncertainty of semiconductor chip availability going into the new year.
And now comes the best part.
Partnering with a trusted shipping provider can help meet that demand. As an industry-leading shipping provider, Forward can scale capacity with agility by tapping into our extensive partner network. With over 8,000 carriers, our brokerage team can facilitate your automotive freight needs as demand shifts occur.
Newsweek’s ® Number Three Most Trustworthy Transportation Provider
With costly time and resources at stake, here are a few ways they can work for you instead of the other way around. While industry experts suggest global auto production is projected to increase by 7% in 2023 despite the ongoing chip shortage, a real need for automotive professionals to partner with a trusted shipping provider arises. Named #3 as Newsweek’s® ‘Most Trustworthy in Transportation’ in March of 2022, Forward is your choice for automotive shipping. As 2023 brings fresh chip supply challenges, Forward has the resources to scale capacity, reduce delays, and help you increase profits through agile shipping solutions that save time and move your freight forward.