Skoda Auto Cuts Production Due to Limited Chips for Vehicles

Skode Auto, has cut production this week due to chip limitations. (photo: Twitter @skodaautonews)

JAKARTA - Based on the news submitted, Skoda Auto, a subsidiary of Volkswagen, has cut production this week due to limited chips. This resulted in several shifts in the production of car models such as Octavia, Enyaq, Fabia, Scala and Kamiq to be cancelled.

Unions say the production situation is deteriorating again after some optimism in the first week of the year.

"After an optimistic first week of the year, the production situation has worsened again," the union said in its weekly Skodovacky Odborar newsletter.

The scarcity of chips for vehicle manufacture in Europe actually occurs due to several factors. As the demand for chips for vehicles and other electronic equipment is currently very high because the demand for electronic products in general is increasing.

Then there are disruptions in the supply chain, such as the COVID-19 pandemic and slow delivery, exacerbating the chip scarcity situation.

Another reason is that chip production capacity is limited and some chip manufacturers are experiencing technical problems, leading to decreased production and delays in shipments.

Meanwhile some chipmakers are shifting production to meet demand from the smartphone and data center markets, reducing chip availability for the vehicle sector.

All these factors together led to a shortage of chips for vehicle manufacturers in Europe and affected the production of automobiles and other electronic equipment.