The Global Chip Shortage Impact on American Automakers
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The Global Chip Shortage Impact on American Automakers

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Global Chip Shortage Impact Automakers

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The Briefing

  • Delays in semiconductor (chip) manufacturing are hitting vehicle production, with more than 1 million vehicles delayed in North America alone.
  • American-based manufacturers Ford, Stellantis and GM are taking the hardest hit, combining for a delay of 855,000 vehicles.
  • Modern cars are built with anywhere between 500-1,500 different chips.

The Global Chip Shortage Impact on American Automakers

Chips, or semiconductor devices, are behind all of the world’s increasingly complex electrical and digital devices.

That includes well-known items like computers and smartphones, but also other products that are becoming “smarter” including appliances, watches, and especially cars.

The automotive industry accounts for a large share of global chip consumption, with modern cars having smart and complex entertainment systems, navigation, and sensors. A modern car can have anywhere from 500-1,500 different chips powering its different functions.

But when the COVID-19 pandemic hit in 2020, shifting consumer demands and a slowing economy called for a reduction in semiconductor manufacturing. And unfortunately, it can take the supply chain a long time to come back online, as much as 1.5 years.

American Manufacturers Take the Biggest Hit

As the global economy has started to bounce back and demand for digital devices has increased, the chip manufacturing supply chain has become strained on its still-low supply.

And unfortunately for automakers, cars are taking the brunt of the hit.

ManufacturerModelEstimated Volume Impact (10k+)
FordFord F-Series109,710
StellantisJeep Cherokee98,584
GMChevrolet Equinox81,833
GMChevrolet Malibu56,929
FordFord Explorer46,766
StellantisJeep Compass42,195
FordFord Edge37,521
FordFord Escape36,463
FordFord Transit26,507
StellantisChrysler Voyager25,728
SubaruSubaru Outback23,882
StellantisChrysler Pacifica19,601
GMGMC Terrain18,417
GMChevrolet Express18,268
VolkswagenVolkswagen Jetta18,044
GMChevrolet Colorado15,153
StellantisRam 150014,793
StellantisJeep Grand Cherokee14,731
GMChevrolet Blazer14,418
StellantisDodge Charger13,492
GMCadillac XT412,233
FordFord Mustang12,019
VolkswagenVolkswagen Tiguan12,010
ToyotaToyota Tundra11,411
FordLincoln Nautilus10,601
SubaruSubaru Ascent10,508
GMChevrolet Camaro10,489
HondaHonda Civic10,206

Though most of the world’s major automakers have factory production in North America, American-based manufacturers are estimated to take the hardest hit.

Of the more than 1.1 million vehicles estimated to face production delays, Ford, Stellantis, and GM combine for 855,000. Ford specifically has five of the top 10 models facing delays, including the largest hit: the F-series at 109,710 delayed units.

ManufacturerEstimated Volume
Impact
Ford324,616
General Motors277,966
Stellantis252,193
Subaru45,272
Volkswagen45,215
Honda42,951
Nissan41,928
Toyota23,670
Tesla6,418
Mazda6,133
COMPAS4,200
Hyundai2,548
Volvo1,287

Other automakers with less production based in North America are facing far softer impacts. Japanese automakers Honda, Nissan, and Toyota are estimated to take a collective hit of 108,549 delayed models, while companies like Hyundai and Volvo have less than 3,000 vehicles impacted.

The biggest reason for the discrepancy? Where each automaker sources and installs its chips. For American manufacturers in particular, the over-dependence on chips coming through China, Korea, and Taiwan has caused the current U.S. government to look for solutions, with the Senate recently approving $52 billion in subsidies for local chip manufacturing.

When the chip shortage will end is currently anybody’s guess, as manufacturers and countries are scrambling to increase capacity. Whether the financial influx from the U.S. will be enough, and how long it will take to affect a very-slow manufacturing process, remains up in the air.

Where does this data come from?

Source: AutoForecast Solutions, Detroit Free Press.

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Datastream

Chart: 30 Years of Wildfires in America

Here’s a look at the number of wildfires in America that have occurred each year since 1990, and the acres of forest land scorched during that period.

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Wildfires in America

The Briefing

  • An average of 70,000 wildfires blaze through the U.S. each year
  • These fires destroy approximately 5.8 million acres of land on a yearly basis
  • Over 43,000 fires have started across the U.S., burning 5 million acres of land as of Sept 3, 2021

30 Years of Wildfires in America

This summer, record-breaking droughts and relentless heat waves have fueled disastrous wildfires across the United States. It’s gotten so bad, the state of California has decided to shut down all national parks for two weeks to stop the spread.

But how disastrous has this year been compared to previous years? This graphic gives a historical look at the number of wildfires in America that have occurred each year since 1990, and the acres of forest land scorched during that period.

Total Wildland Fires and Acres from 1990 to 2020

In the U.S., an average of 70,000 wildfires burn through 5.8 million acres of land each year. But some years have been worse than others.

Year# of Fires# of Acres Burned
199066,4814,621,621
199175,7542,953,578
199287,3942,069,929
199358,8101,797,574
199479,1074,073,579
199582,2341,840,546
199696,3636,065,998
199766,1962,856,959
199881,0431,329,704
199992,4875,626,093
200092,2507,393,493
200184,0793,570,911
200273,4577,184,712
200363,6293,960,842
200465,461*8,097,880
200566,7538,689,389
200696,3859,873,745
200785,7059,328,045
200878,9795,292,468
200978,7925,921,786
201071,9713,422,724
201174,1268,711,367
201267,7749,326,238
201347,5794,319,546
201463,3123,595,613
201568,15110,125,149
201667,7435,509,995
201771,49910,026,086
201858,0838,767,492
201950,4774,664,364
202058,95010,122,336
2021*43,2505,024,744

*note: 2021 figures as of September 3, 2021

One particularly bad year was 2006, which had over 96,000 fires and destroyed 9.9 million acres of land across the country. It was the year of the Esperanza Fire in California, which burned 40,000 acres and cost $9 million in damages.

2015 was also a devastating year, with over 10.1 million acres destroyed across the country–the worst year on record, in terms of acres burned.

Climate Change’s Role in Wildfires

Wildfires are only expected to worsen in the near future since warmer temperatures and drier climates allow the fires to grow quickly and intensely.

We’re already starting to see climate change impact the wildfire season. For instance, autumn is usually peak wildfire season for California, but this year, one of the largest fires on record started in mid-July, and is still burning as of the date of publication.

>>Also see: North America’s Devastating Wildfires, Viewed From Space

Where does this data come from?

Source: National Interagency Fire Center
Details: 2004 fires and acres do not include state lands for North Carolina.

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Datastream

Visualizing the Typical Atlantic Hurricane Season

While the Atlantic hurricane season runs from June to late November, about 85% of activity happens between August, September, and October.

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The Briefing

  • Storms are categorized by their wind speed. Any storm with winds stronger than 111 miles per hour (mph) is considered a major hurricane
  • This year’s Hurricane Ida is one of the strongest hurricanes on record to hit the U.S. mainland, with winds reaching up to 150 mph

Explained: The Typical Atlantic Hurricane Season

On August 29, 2021, Hurricane Ida hurled into the state of Louisiana at rapid speed. With winds of 150 mph, preliminary reports believe it’s the fifth strongest hurricane to ever hit the U.S. mainland.

As research shows, Hurricane Ida’s impact hit right at the peak of the Atlantic hurricane season. Here’s a brief explainer on the basics of hurricanes, how storms are classified, and what a typical storm season looks like in the Atlantic Basin.

Let’s dive in.

Classifying a Storm

Hurricanes are intense tropical storms that are classified by their wind speed. What’s the difference between a hurricane, a typhoon, and a cyclone? They’re essentially the same thing, but are named differently based on their location:

  • Hurricane is used for storms that formed in the North Atlantic, central North Pacific, and eastern North Pacific (impacting countries like the U.S.)
  • Typhoon is used for storms in the Northwest Pacific (impacting countries like Japan)
  • Tropical Cyclone is used for storms in the South Pacific and Indian Ocean (impacting countries like Fiji and India)

Since we’re focusing on the Atlantic, we’ll be using the term hurricane and/or storm throughout the rest of this article.

A storm needs to reach a certain wind speed before it gets classified as a hurricane. Storms with wind speeds of:

  • <73 mph are considered Tropical Storms
  • 74-110 mph winds are considered Hurricanes
  • 111 mph+ winds are considered Major Hurricanes

Breaking Down the Atlantic Hurricane Season

Generally, Hurricanes form in the warm ocean waters in the central Atlantic and Gulf of Mexico, following westward trade winds and curving up towards the North American mainland. Hurricanes are formed when these specific elements come into play:

  • A pre-existing weather disturbance such as a tropical wave
  • Water at least 80ºF (27ºC) with a depth of at least 50 meters
  • Thunderstorm activity
  • Low wind shear (too much wind can remove the heat and moisture hurricanes use for fuel)

The Atlantic hurricane season technically lasts six months, beginning on June 1st and ending in late November. However, 85% of activity happens between August, September, and October.

Each subregion in the Atlantic has its own unique climatology, which means peak seasons can vary from place to place—for example, south Florida sees the most hurricanes in October, while the entire Atlantic Basin’s peak season is early-to-mid September.

Climate Change and Hurricanes

According to the Center of Climate Change and Energy Solutions, it’s unclear whether climate change will increase the number of hurricanes per year.

However, research indicates that warmer weather and high ocean temperatures will most likely lead to more intense storms, ultimately causing more damage and devastation.

» Want to learn more about climate change? Here’s an article on The Paris Agreement: Is The World’s Climate Action Plan on Track?

Where does this data come from?

Source:Brian McNoldy, University of Miami Rosenstiel School of Marine and Atmospheric Science

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