MLive: John Taylor on semiconductor supply chain
Gas prices are influencing car buying preferences according to the latest inventory reports showing that compact cars are moving faster than their larger counterparts. A record high $5 per gallon nationally have curbed spending patterns, according to Cox Automotive. Cox’s new vehicle inventory report for May showed compact cars are staying on the lot for less than 20 days, while full-sized SUVs and trucks have more than double the days on the market. Chip shortages have now cost the auto industry 2 million vehicles that won’t be recouped. Car makers are still prioritizing high-end, high-margin models instead of entry-level vehicles. This ripple effect has shown up in the inventory data, too. Drivers can see the effects of the semiconductor shortage right on the road – or rather the parking lot. The semiconductor supply chain has improved but new production will take at least two to three years to really make a dent in production, said John Taylor, associate professor of supply chain management at Wayne State University. “If you use semiconductors, you’re scrambling,” he said.