The automotive supply chain involves thousands of components, and the absence of a single chip can halt the delivery of an entire vehicle. Without production stability, the only options in extreme situations are to reduce specifications or delay deliveries.
The topic of automotive "chip shortages" garnered significant attention during the 2026 Shanghai Electronica exhibition held this week. As vehicle intelligent driving systems become more advanced and infotainment systems consume more power, chips have become a crucial part of automobile manufacturing.
Aptiv PLC has responded regarding how it is managing the situation of rising chip prices and supply shortages.
The company stated that a trend of increasing prices for global memory chips began in the second half of last year. Overall, Aptiv PLC employs a supply chain model that combines localization with globalization, featuring multiple redundant suppliers to enable flexible allocation of global resources. The company has also established a digital twin system, implementing a dual-track backup management for imported and domestically produced chips. It utilizes intelligent large models for detection and forecasting, allowing for the pre-emptive stockpiling of memory chips to effectively hedge against supply chain risks.
Aptiv PLC provides intelligent automotive solutions, which include not only products like connectors but also computing platforms and domain controllers. These intelligent products are considered the "brain" of the vehicle and are highly dependent on AI chips for computing power support. Consequently, chips have become a critical link in ensuring automotive supply chain security.
To address cost pressures and chip price increases, Aptiv PLC is also choosing to tackle the issue from the foundational architecture. By optimizing the power management system, it aims to reduce the load on the powertrain battery and high-voltage systems, thereby indirectly lessening reliance on certain high-cost power chips.
A partner in the Greater China automotive consulting practice at AlixPartners commented: "The proliferation of automotive three-electric systems has led to a substantial increase in demand for power chips. Simultaneously, growing power demands from other AI-related industries are creating a compounding effect. This intensifies the competition for production capacity of automotive-grade chips, resulting in tight supply for some high-end chips."
The entire automotive industry currently faces the challenge of securing chips. Just this week, General Motors announced a long-term supply agreement with Micron Technology to ensure its supply of memory and storage chips, with both companies also collaborating to develop future-oriented technologies.
A significant factor exacerbating the "chip famine" is the global surge in investment in AI-driven data centers. According to the latest automotive industry research data from AlixPartners, by 2028, AI data centers are expected to account for approximately half of the global market demand for memory chips. Combined with other risk factors, this will substantially drive up chip prices.
The report states: "Supply of the new-generation DDR4 memory chips is currently extremely tight, with customers receiving only 30% to 50% of their allocation. Most Dynamic Random-Access Memory (DRAM) is facing shortages, forcing clients to procure from the open market. However, manufacturers are currently unable to confirm specific allocation details."
According to another report from S&P Global Mobility, memory chip prices have increased by about 70% since last December. DRAM is a key component in servers that power cloud computing, databases, and AI workloads.
The Managing Director and Head of Automotive and Industrial Practice for Asia Pacific at AlixPartners noted: "Currently, the largest customers for memory chips are data centers, followed by smartphones, then computers and other electronic consumer products, with automobiles last. Therefore, the impact of price increases is more pronounced for the automotive industry."
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