A new report from self-driving technology company Mobileye has indicated a downturn in the automotive chip market in 2024. While self-driving car manufacturers managed to navigate the semiconductor shortage by purchasing surplus chip components during the COVID pandemic, the slow growth of the autonomous vehicle market has resulted in over-stocked chip inventories.
As semiconductor production began to normalize in 2023, self-driving car manufacturers are now seeking to clear their storage facilities and improve cost-efficiency by halting shipments of new chips until supply and demand reach a better balance. Mobileye estimates that the sector is currently burdened with an excess of at least 6 million units.
This shift is expected to impact chip suppliers and material manufacturers, as there will be a notable dip in demand in the first quarter of 2024. Mobileye forecasts a 50% year-over-year decline in revenue for the first quarter, leading to an annual operational loss between $378 million and $468 million. In comparison, the company’s loss forecast for 2023 was between $33 million and $39 million.
Mobileye, which specializes in developing self-driving software and systems including cameras and automotive computer chips, saw its shares plummet by almost 30% in response to its warnings for 2024. While other semiconductor suppliers serving the car industry also experienced a dip in stock prices following Mobileye’s report, the impact was limited to single-digit percentages.
This downturn in the automotive chip market signifies the need for a more cautious approach in chip production and inventory management. Companies will have to reevaluate their strategies and find ways to align supply with the actual demand for autonomous vehicles, ensuring a smoother transition in the future.
The source of the article is from the blog klikeri.rs