Semiconductor shortage reveals dependence on digital imports

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The lack of chips is not only affecting the automotive industry hard. Other industries are also desperately looking for semiconductors. Other digital products are more readily available. But many German companies also see dangerous dependencies here.

Microprocessors are a scarce commodity these weeks, especially among automakers. At Volkswagen, Audi or Daimler, shifts have even been canceled recently because the coveted chips simply could not be found or had arrived late in production. There are many reasons for the international shortage of semiconductors: Because of the trade war between the USA and China, Chinese manufacturers such as Huawei and Xiaomi are currently buying the markets empty. Manufacturers of PCs and game consoles are also after the semiconductors because the corona crisis has given them an exceptional boom that they can hardly satisfy.

Freezing catastrophe in Texas exacerbates semiconductor shortages

The lack of supplies is putting a strain on the automotive industry at an extremely inopportune time. It is in the midst of a comprehensive shift towards electromobility and suffered significant sales losses in the corona crisis. As a result, important production capacities in the semiconductor sector were lost to competing industries. And now that the demand for cars is picking up again, the chips are missing.

The semiconductor shortage is exacerbated by the current cold disaster in Texas. The unusually low temperatures in the south of the USA have caused large-scale power outages and are hindering chip production there. In addition to Samsung and NXP, the German chip manufacturer Infineon is also active in the region of the Texas capital Austin. After a warning from the electricity supplier, those responsible were able to shut down production just in time on Tuesday before a sudden power failure would have permanently damaged the production facilities.

Due to the failure in Texas, the shortage of microcontrollers and semiconductors for power electronics is now exacerbated, so that many customers will probably have to wait longer for their new car. “We have a shortage,” said Achim Berg, President of the Bitkom digital association, at an online press conference on Thursday.

Entrepreneurs see the greatest dependency on IT hardware

The semiconductor industry is on the list of digital products and services for which German industry as a whole is dependent on deliveries from abroad to a dangerous extent, but not at the top. The digital association Bitkom asked companies in Germany about this. The entrepreneurs see the dependency on IT and communication hardware, 5G mobile communications and artificial intelligence as the strongest.

Even beyond possible delivery bottlenecks, this general dependency on imports of digital technologies gives those responsible in companies headaches, because digital imports are existentially important for the German economy. The representative survey of 1,100 companies showed that 94 percent of them depend on it. “A large majority of companies in Germany consider themselves only able to survive for a short time if digital technologies or services can suddenly no longer be obtained from abroad,” said Berg.

The problem is exacerbated by the fact that German business’s trust in the USA, a key player in the international IT industry, is now comparatively low. Only 39 percent of German entrepreneurs have “great confidence” in the USA as a business location. China (31 percent) and Russia (15 percent) are viewed with even more skepticism. But among the EU countries, the confidence level is a proud 89 percent, followed by Japan (61 percent) and Great Britain (59 percent).

“It’s about helping to shape key digital technologies at eye level in the future”

Of the Bitkom-President demanded that the German economy should get rid of unhealthy dependencies and develop more independence. “It’s about helping to shape key digital technologies, business models and ecosystems at eye level in the future.” Berg spoke out against trade barriers. State funding for research and development is desirable. Existing skills should be strengthened. “For example, we are very good at autonomous driving” There are also great strengths in IT security and artificial intelligence, as well as in medicine.

But even if the demands of the digital association were implemented quickly, there would hardly be any change in the dependence on digital technology from abroad in the short term. In order to meet the increased demand for semiconductors, for example, new capacities have to be built up – and that takes time.

In addition, automobile manufacturers in particular are faced with the challenge of being perceived by the chip industry as a relevant customer for whom it is worthwhile to expand new capacities. The iPhone manufacturer Apple alone uses roughly as many microprocessors as the entire automotive industry. Only companies from the USA, South Korea and China are on the list of the top chip buyers worldwide by market researcher Gartner.

[Christoph Dernbach]


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