The worst may soon be over when it comes to disruptions stemming from the global chip shortage, according to Goldman Sachs.
Andrew Tilton, chief Asia economist at the bank, said the situation could improve in the second half of 2021.
He said there have been “noticeable tightening” of supply chains and shipment delays in North Asian economies such as Japan, Taiwan and South Korea, which are involved in the semiconductor supply chain.
“That will have an impact on downstream sectors. Auto production is one of those,” he told CNBC’s “Street Signs Asia” on Monday.
“Our analysts believe we’re probably in the worst period of that right now. That is, we’re seeing the biggest disruption downstream (in) industries like auto right now and that will gradually ease over the back half of the year,” Tilton said.
The world has been grappling with a chip shortage that has hit the production of household electronics, including everything from toasters to washing machines.
It is also expected to cost the global auto industry $110 billion in revenue in 2021, according to consulting firm AlixPartners.
The firm expects the largest impact to car production to hit in the second quarter, before progressively getting better during the second half of the year and