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Chip constraints to last through 2022, French trade group says

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PARIS — The chip shortage that has idled automotive factories around the world could linger through most of 2022, the head of the French automotive industry association PFA said. 

French assembly plants are operating at 60 percent capacity right now, said Luc Chatel, president of the group, which represents 4,000 businesses and works with the French government on strategic and investment decisions.

“We are in a long-term crisis that will have a lasting impact on the automotive industry,” Chatel said in an interview Tuesday morning with French business network BFM. He said more capacity was needed in Europe but that it would take time to put that in place.

Chatel said it was difficult to say exactly which plants in France were affected by the chip shortage.

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“It depends on the day,” he said. “Constructors learn at the last minute how many semiconductors are available” and make decisions based on that. 

Automotive executives are sounding increasingly pessimistic that the semiconductor issue will be resolved any time soon. The head of Bosch in China said over the weekend that shortages will last through next year, and that half of the demand for automotive chips remained unfilled.

Chatel said French sales could be down as much as 20 percent compared with pre-pandemic levels. The market fell by 21 percent in September. 

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He also warned of inflationary pressures due to rising prices for raw materials, transport and shipping, and fuel.

“I’m not optimistic about the coming months,” he said.

Reuters contributed to this report

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