As the auto industry continues to battle the ongoing global shortage of semiconductor chips, it looks like reduced rubber supplies may compound the auto industry’s woes. However, General Motors says it currently isn’t worried about diminishing supplies of rubber.
Recent reports indicate that natural rubber stockpiles have fallen, with rising prices and diminishing supply following a destructive leaf disease that has wreaked havoc on rubber tree crops. The scarcity has been exacerbated after China, the largest consumer of natural rubber and the biggest auto market in the world, began stockpiling the material last year.
Given the material’s use in tires and various automotive components, the rubber shortage could have a profound effect on the automotive industry, including General Motors, which is already reeling from widespread production losses due to the ongoing semiconductor chip shortage. However, according to a recent post from Bloomberg, General Motors stated that it wasn’t worried about its rubber supply. Meanwhile, General Motors rivals Ford Motor Co. and Stellantis NV said that they are monitoring the rubber supply issue, but have yet to be impacted by the shortage.
Natural rubber is produced by extracting sap from certain types of trees, with Thailand, Indonesia, and Vietnam topping the list of the world’s largest natural rubber producers. Although synthetic rubber is used for certain applications, natural rubber remains critical to key automotive components, such as tires, wiper blades, engine mounts, and hoses.
As Bloomberg points out, the automotive industry relies on just-in-time manufacturing to help reduce costs, which leaves it vulnerable to supply chain disruptions, including a potential downturn in rubber supplies.
General Motors has already faced numerous production cuts as a result of the ongoing semiconductor chip shortage, with some estimates placing lost production figures at 60,000 fewer GM vehicles produced in North America, and 216,000 fewer GM vehicles produced globally. General Motors estimates that the chip shortage could eat into corporate earnings for the 2021 calendar year by as much as $2 billion.
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Comments
This is where GM is right, because there is no tire shortage anywhere in the world. This is just speculation to drive the stocks or scare people.
Yesterday I ordered 4 tires for one of my Joungtimers and they can be delivered immediately, although a special size 215/55 R16 for an old W210 Mercedes 220d.
We need to watch it. Nat Rubber is becoming scarce, that does not mean that tires produced 4-6 months ago already on the shelf are in short supply, it takes time to impact finished goods. There is a lag between shortage of a raw material and shortage of the finished product.
Why in the 2020s we’re still using limited natural crap anyways?. What’s next?, wooden boats and airplanes?.
With the limitation of goods, prices can go up and higher profits can be made.
Market economy!
we know you are being sarcastic. you probably hate capitalism and wished you lived in china with hunter biden.
Judging by your first and last name, we’re all just a bunch of commoners.
For the potential loss of $2B for just in time manufacturing, a little foresight might be rewarded with reducing those losses. Learn from China.
JIT only works with excess quantities of material and that is now over. Many are still learning, but only a few are already able to carry out lean ordering processes. GM can do it!
GM doesn’t care about a price increase or shortage , they will just raise the price on a new vehicle, they are in business to make $$ nothing else, the worse customer service of any large corporation.
Strange, all of GM’s brands are above average in JD Power Customer Service Index. https://www.jdpower.com/business/press-releases/2021-customer-service-index-csi-study
Read a note about 4 weeks ago that there is also a shortage of foam for seats.
Thta is why I still believe that if we really want to turn the tide into the right direction, climate wise (read: earth destruction) is to go Hydrogen Fuel Cells. Although still there is a need to have difficult to obtain rare earth metals and the like, these are needed in less quantity, and therefore not eating up every natural resource (crap as I read from Guestt) still out there.
At the end, Hydrogen is the element more abundant known to man.
Hydrogen is not the most abundant element on Earth, the planet is too small so all the H2 (and He) escaped gravity and floated into space. The planet needs to be about 100x heavier, basically Saturn, to keep the H2 in. The most abundant elements on Earth, as a whole, are Fe, O, Si, Mg, S, Ni, Ca, Al.
Hydrogen production today comes from natural gas, it’s too expensive otherwise.
yes it is.
I thought this was just another scheme to help Planned Parenthood. Nevermind
starving condom production to increase abortions IS the liberal agenda. just like their refusal to increase opec production through military to increase gas prices to drive people to EVs.
The chip shortage is the funniest thing of all,because electric cars use more chips than non-electric and the materials used for their manufacture are getting more scarce.
liberals don’t care about anybody but themselves.
They probably have a long-term contract and if they back out they will probably not use them for a while,hurting there bottom line.
Woke people decided rubber should only be used for condoms and rubber plantations were “rayyycissss” so now the tire industry depends on synthetic rubber.