The auto industry has been in panic mode for months, a shortage of computer chips forced some automakers to suspend production for extended periods, leading to empty dealer lots and skyrocketing prices. But one company seemed to sidestep the whole crisis, Tesla has been breaking records quarter after quarter and sold nearly twice as many vehicles in 2021 as it did in 2020. Tesla wasn’t able to get the chips it had ordered in sufficient quantities. Unlike other OEMs, however, it was able to rewrite its software in order to take advantage of the chips that were available. "We have used alternative parts and programmed software to mitigate the challenges caused by these shortages," the company said in its earnings report. The legacy automakers didn’t have that option, because their computing software and hardware are under the control of suppliers. The Times reports that, in many cases, automakers also relied on these suppliers to deal with chip manufacturers, so they lacked the leverage to bargain with the chipsters.

Source: Summarized from EVANNEX.

My Take: Good planning and vertical integration wins the day.

Re Posted From: Tesla Vs Chip Shortage

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The auto industry has been in panic mode for months, a shortage of computer chips forced some automakers to suspend production for extended periods, leading to empty dealer lots and skyrocketing prices. But one company seemed to sidestep the whole crisis, Tesla has been breaking records quarter after quarter and sold nearly twice as many vehicles in 2021 as it did in 2020. Tesla wasn’t able to get the chips it had ordered in sufficient quantities. Unlike other OEMs, however, it was able to rewrite its software in order to take advantage of the chips that were available. "We have used alternative parts and programmed software to mitigate the challenges caused by these shortages," the company said in its earnings report. The legacy automakers didn’t have that option, because their computing software and hardware are under the control of suppliers. The Times reports that, in many cases, automakers also relied on these suppliers to deal with chip manufacturers, so they lacked the leverage to bargain with the chipsters.

Source: Summarized from EVANNEX.

My Take: Good planning and vertical integration wins the day.

Re Posted From: Tesla Vs Chip Shortage

Auto Helpers