How a looming chip shortage could impact American automakers and buyers
In response to U.S. trade restrictions, China has stopped exporting crucial chips used by automakers across North America. That’s already slowing down production of some models.

The U.S. has trade restrictions on certain foreign companies for national security reasons. President Donald Trump recently expanded the number of companies on that list, to include a Chinese company called Wingtech.
That’s created headaches. Wingtech owns a company called Nexperia, which produces low-tech computer chips used in many cars.
Last month, China stopped shipping Nexperia chips out of the country. The chips in question aren’t the most cutting edge, according to Sam Fiorani, VP of global vehicle forecasting at Auto Forecast Solutions.
“These chips operate secondary parts of the car, like power windows or things like that — non-crucial parts,” he said. “However, the components themselves are crucial to the vehicle in selling a vehicle.”
Because you can’t sell a car without all the parts, he said. “It could halt production in a number of places, and it is already slowing production in plants in the United States and across North America.”
That’s because car makers can’t easily — or suddenly — switch chip providers, per Erin Keating, an executive analyst at Cox Automotive. There are testing and regulation requirements they have to follow.
Most automakers use the chips, so some will lean on stockpiles, she said.
But if those run out, “they're going to have to make some tough decisions and likely prioritize more profitable models to be sure that they keep the inventory of those models and also fast-selling models in production.”
Keating noted that there’s a decent supply of cars on dealership lots for now, but that won’t last forever. “All of it, at the end of the day, puts the consumer at risk of not having the choice on the lot that they're looking for.”
So, she said that buyers should shop early and try to keep their options open.


