Tesla CEO Elon Musk is confident the chip shortage will be solved short term

by 9SIX

Tesla CEO Elon Musk disclosed that he is confident the chip shortage is going to be solved in the short term, despite many disagreeing.

The pandemic has resulted in an increased demand for many electronics and computers that the supply chain couldn’t handle, especially the semiconductor industry.

This microchip shortage, in turn, affected the automotive industry, which has increasingly become a big consumer of microchips.

We previously released a deep-dive report on how the chip shortage is affecting electric vehicle production as several automakers had to halt production until chip supply could catch up.

Pat Gelsinger, CEO of Intel, one of the biggest semiconductor companies, recently said that it could take a “couple of years” for the industry to catch up to the surging demand.

Earlier this year, Tesla CEO Elon Musk confirmed that it is affecting Tesla, but he believes it’s not a “long-term issue.”

When discussing Tesla’s performance this quarter, Musk said that Tesla’s current biggest challenge is the supply chain issue, especially “microcontroller chips.”

Our biggest challenge is supply chain, especially microcontroller chips. Never seen anything like it. Fear of running out is causing every company to overorder – like the toilet paper shortage, but at epic scale. That said, it’s obviously not a long-term issue.

Today, at a tech conference in Italy, Musk again commented on the timeline and claimed that it should be fixed “by next year” with new factories coming up:

“There’s a lot of chip fabrication plants that are being built and I think we will have good capacity by next year.”

The CEO’s outlook is more optimistic than several other industry leaders who see the issue lasting up to 2023.

As we previously reported, Tesla also said that it managed to contain the problem during the first quarter by switching to new microcontrollers:

“In Q1, we were able to navigate through global chip supply shortage issues in part by pivoting extremely quickly to new microcontrollers, while simultaneously developing firmware for new chips made by new suppliers.”

Some reports suggested that Tesla even considered buying its own chip factory to address the issue.

Source: electrek

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