According toAutomotive News the global chip shortage is a highly complex crisis with many moving parts. Chip production is more complicated than automotive production. The average chip plant operates 24 hours a day, 365 days per year, far more than an auto plant. Chip plants can take up to five years to construct and ramp-up at total capacity compared to an automotive plant which takes two and half years. While vehicles can be built in as little as 15-30 hours, chip production, packaging, and shipping can take up to five months.

The good news is that many automakers and chipmakers have made considerable investments in domestic chip production. Taiwan Semiconductor Manufacturing Co. (TSMC) is one of the largest chipmakers in the world, and it has invested $12B in an Arizona-based facility that will start production in 2024. Intel has already begun construction to expand its chip capacity to $20 billion in Arizona, and Samsung will spend $17 billion in Texas on a new plant. Numerous companies are also working to improve the efficiency of chip production. Although these changes won’t immediately impact the market or automotive production, it is clear that chip supply will no longer be a problem once they are up and running.