The global chip shortage continues to impact the automotive industry, primarily causing production disruptions and reducing supply despite steady demand. Hopes of ending the 2022 year with a chip increase to ramp up production, although present, is not enough to satisfy demand.

To recap, global supply chain issues began when the Covid pandemic emerged and spread quickly throughout the globe. Resulting shutdowns caused widespread restructuring in every industry. Not only that, but the war between Russia and Ukraine, along with China’s Covid resurgence, perpetuated the chip shortage well into 2022. These factors led to a production decrease for auto and auto part producers as data chips required for many technologies diminished in the global supply-chain disruption from 2020 to the present. 

While the chip shortage resulted in a rapid decrease in production for auto and auto part producers alike, research suggests the shortage is projected to get better and get worse in 2023.

How can that be, you ask?

The automotive production disruption in 2022 caused a decrease in order fulfillment, this decrease in order fulfillment quickly caused demand to increase. As a steady increase in chip availability is expected in 2023, production increase and order fulfillment will occur. Now comes the tricky part. It can be challenge to find a shipping partner that can scale capacity as needed while offering consistent, quick, and reliable turnaround times. Changing gears to explore how these qualities in a shipping partner will enhance shipping capacity, improve forecasting accuracy, and increase profits for auto and auto part producers will provide greater insight.

Agile Shipping Solutions to Scale Auto Freight Capacity 

While auto and auto part producers rapidly adjust production based on chip availability, the need to quickly scale freight capacity is critical. Despite the increase in chip production, the automotive industry faces yet another obstacle – a supply shortage of semiconductors [a specialized chip specific to automotive producers]. While chip availability for other technologies is slowly on the rise, confidence in semiconductor chip availability for 2023 causes concern. The right shipping partner with the resources to scale capacity as needed is an essential variable to consider while navigating the uncertainty of semiconductor chip availability going into the new year. As an industry-leading shipping provider, Forward can scale capacity with agility by tapping into an extensive partner network. With over 8,000 carrier partners, the brokerage team can facilitate your auto industry freight needs as demand shifts occur.

Consistent and Quick Shipping to Improve Forecast Accuracies

As semiconductor chips become increasingly available, the challenges for the automotive industry shift from under-supply to over-supply. When that occurs, freight capacity and speed to market are essential. The CEO of the Center of Automotive Research, Alan Amici, projects the semiconductor shortage to perpetuate well into 2023. With a strategy of allocating available chips to highly profitable cars first, the demand will continue to build for the less profitable vehicles. Consequently, a backlog of orders will build and is ultimately fulfilled upon the availability of semiconductors.

And now comes the best part. Partnering with a trusted shipping provider can help. Expedited LTL and Full Truckload services equip auto and auto part professionals with a solution to get your freight where it needs to go – on time and on budget. Trusted partnerships with Forward result in delivery schedules that can be used to accommodate your unique needs. With shipments arriving and leaving daily from our 200+ terminal locations, there is always space for your auto freight when you need it. If you want to join an industry leader that has a proven history of consistent, reliable, and quick shipment times to forecast production and turnaround times accurately, Forward is your answer.

Reduce Auto Freight Shipping Delays to Increase Profits

Ultimately reducing shipping delays can increase profits for auto producers. Competition for automotive supplies is high. With many suppliers and easy access to products through the internet, quick order fulfillment is a must for companies to stay competitive. Auto producers have a need to ensure their customers are stocked and ready with inventory when consumers are looking to purchase; otherwise, consumers will find what they are looking for elsewhere. That is why partnering with a trusted shipping company that has a nationwide footprint and 200+ terminal locations is key to reducing delays and increasing profitability for auto suppliers. As an experienced and well-established shipping company, Forward increases value by reducing delays and offering fewer touchpoints along the freight journey to move your automotive supplies forward.

Newsweek’s ® Number Three Most Trustworthy Transportation Provider

With costly time and resources at stake, here are a few ways to make them work for you instead of the other way around. While industry experts suggest global auto production is projected to increase by 7% in 2023, despite the ongoing chip shortage, a real need for automotive professionals to partner with a trusted shipping provider arises. Voted #3 as Newsweek’s® ‘Most Trustworthy in Transportation’, in March of 2022, Forward is your choice for automotive shipping. As 2023 brings fresh chip supply challenges, rest assured Forward has the expertise and resources to scale capacity as needed, reduce delays, and help you increase profits through agile shipping solutions that save time and move your freight forward.