The automotive industry needs to live with semiconductor shortages as they have become “the new normal,” according to Nissan.
“Semiconductor shortage is a new normal, same as the pandemic, and we have to live with it because this is not going to finish tomorrow morning,” chief operating officer Ashwani Gupta said today.
The Japanese automotive maker announced it was expecting flat profits for the year as a result of Covid-induced chip shortages, rising material costs and the impact of China’s Zero Covid policy on supply chains.
Nissan’s profits are set to increase 1 per cent to 250bn yen (£1.6bn), well below analysts’ predictions of 318.5bn yen, because of raw material and logistics costs surging to 212bn.
Nissan is the latest automotive maker to narrow profitability and sales as a result of pandemic and war-induced disruption to supply chains, logistics and transport.
Toyota announced today that an “unprecedented” hike raw material costs could axe a fifth of its profits, forcing it to slash production.
Costs, the company said, are expected to go up to 1 trillion yen prompting the company to use cheaper materials.
“Since the price of materials is rising, we need to work to reduce the amount of materials we use as much as possible and to replace them with less expensive materials,” chief executive Kenta Kon told reporters.