Chip Shortages into 2023 Part of a Perfect Storm Sweeping Away Old Car Companies

The world lost 11.3 million units of production in 2021 because of the chip shortage, according to AutoForecast Solutions. IHS predicts chip shortages will mean 7 million fewer cars in 2022 and 1.6 million in 2023.

The shortage of cars has increased the average selling price of the remaining new cars that were made and increased used car prices.

Global EV car demand is ramping up at the same time as the chip shortages and Pandemic supply chain problems hit regular carmakers. This gives Tesla a huge opening to ramp up production at the Austin, Berlin and Shanghai factories in 2022 and 2023. There is more demand for EVs and less competing production and higher prices from regular ICE cars.

By the time regular carmakers are back to “normal” they will be facing a Tesla in January 2024 that has made and sold over 2 million cars in 2022 and 4 million cars in 2023. A Tesla making over 1 million cars per quarter will be making $50 billion of auto revenue with $18 billion of gross profit. This should be $60 billion of net income in 2023.

Tesla will make about 20% more non-car related revenue like energy storage, insurance and solar.

Tesla with $250 billion in annual revenue would be in the range of Volkswagen and Toyota who make $240-280 billion per year in revenue. However, Tesla will be far more profitable.

The traditional car companies will become smaller and weaker than Tesla in every way. They will still need to try to transition their factories and employees to making the new batteries and electric cars. Tesla will be growing its technology lead.

SOURCES – Motortrend
Written by Brian Wang, Nextbigfuture.com (Brian owns shares of Tesla)

Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.

Known for identifying cutting edge technologies, he is currently a Co-Founder of a startup and fundraiser for high potential early-stage companies. He is the Head of Research for Allocations for deep technology investments and an Angel Investor at Space Angels.

A frequent speaker at corporations, he has been a TEDx speaker, a Singularity University speaker and guest at numerous interviews for radio and podcasts.  He is open to public speaking and advising engagements.