High demand from other industries signals a looming automotive semiconductor shortfall

While the automotive semiconductor industry has gained valuable insights from pandemic-induced shortages and has implemented more robust forecasting and process improvements, some level of disruption is still anticipated. The projected shortage in late 2025 or early 2026 may not reach the severity or duration of the previous crisis, but a supply-demand mismatch is likely, particularly depending on global demand fluctuations during that period.

Recent public announcements from key players in the automotive and semiconductor industries have raised alarms about a potential chip shortage expected to hit in the later half of 2025 or 2026. A top executive from Continental has indicated that, based on current forecasts, the industry may face another round of semiconductor shortages around the third or fourth quarter of 2025. During its second-quarter earnings call, TSMC CEO C.C. Wei highlighted that the supply of advanced chips is unlikely to meet demand until 2025 or 2026.