China stares at 1 million EV shortfall due to chip shortage in 2022

The global chip shortage is set to send China's EV industry into partial freeze in the first half of 2022, as there will be a shortfall of at least 1 million electric cars amid the soaring demand.

According to South China Morning Post, the companies can produce enough semiconductors, microcontroller units and high-end chips with artificial intelligence (AI) processors for 4 million of the new energy vehicles (NEVs) in China in 2022.

"The shortage of automotive chips that had hindered the growth of the car market has yet to ease," the CPCA said in a research report.

"The bestselling models still need chips to reinforce their production, and get their backlog of orders executed."

A resurgence of Covid-19 around Southeast Asia this summer disrupted production at several chip foundries.

"China is beginning to feel the brunt of the disruptions, at a time when car owners are being encouraged to ditch their petrol-guzzling cars for pure electric, plug-in hybrid and fuel-cell cars to help the nation achieve carbon neutrality in 2060," said the report.

In November, Tesla's Shanghai-made Model 3 and Model Y vehicles were being shipped with USB ports that can only be used for charging, not for data transfer, due to the supply shortage.

Amid the global chip shortfall, the South Korean tech giant Samsung believes that the chip shortage will continue up until the second half of 2022.

The issue was discussed by TM Roh, the president of Samsung Mobile, during a meeting with senior executives and executives from over 30 of its major smartphone component suppliers, reports TheElec.

Samsung is taking multiple steps to mitigate the shortages. The firm is going to push for annual contracts with chip foundries to secure the chip production capacity.

Meanwhile, Qualcomm CEO Cristiano Amon said that the chip shortage is gradually easing and the situation is expected to improve next year.