China’s dependence on foreign suppliers of computer chips could undermine the country’s transition to electric vehicles, tech traders and researchers say.
The shortage of chips, or semiconductors, is more acute in China than elsewhere and could hit the nation’s EV momentum, according to CATARC, the China Automotive Technology and Research Center, because its fledgling domestic chipmaking industry is unlikely to be in a position to cope with demand within the next two to three years, it says.
With delivery delays of up to a year, that means carmakers in China are occasionally being forced to pay expensive premiums to chip brokers in cities like Shenzhen, where there is a “grey market” trade in semiconductors.
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