Mexico Expects Semiconductor Supply To Fully Recover This Year

The semi-conductor supply in Mexico will recover this year. (photo: doc. unsplash)

JAKARTA - The global semiconductor shortage that has weighed on Mexico's auto sector will return to normal this year. Even the Mexican Automotive Industry Association (AMIA) said on Tuesday, February 8 that the supply of chips in the country will reach the same level as pre-pandemic in the second half of 2022,

"We expect semiconductor shortages to stabilize throughout the year and by the second half they could return to the levels we had before the pandemic," AMIA head Fausto Cuevas told a news conference.

Official data last week showed that Mexico's auto production and exports fell in January compared to a year earlier. It was the seventh straight monthly decline, as the shock of the COVID-19 pandemic and semiconductor shortages has hurt the sector.

A return to a more normal supply of semiconductors will allow automakers in Mexico to increase their use of installed capacity. Car production will also increase.

"It seems to me that whenever there is sufficient supply of (semiconductors), automakers restore their capacity levels to what they were before, as soon as possible," Cuevas added.

Vehicle production fell 2% in 2021 compared with 2020, the fourth consecutive annual decline, as semiconductor shortages in recent months prompted automakers in Mexico and across North America to implement rolling shutdowns, limiting production.

AMIA previously predicted output would not return to pre-pandemic levels until late 2023 or 2024.