Jeep Maker Says Top Suppliers Failed Carmakers in Chip Shortage

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The head of Jeep maker Stellantis NV said major auto-parts makers have let down car companies that count on them to avoid supply-chain crises like the chip shortage that’s crippled production across the industry.

“Over the last 20 years, we were assuming that the tier-one suppliers would protect us from this kind of situation,” Chief Executive Officer Carlos Tavares said Wednesday during a Financial Times virtual car summit. “It’s fair to say that we were not protected.”

The comments are among the sharpest a major auto CEO has publicly leveled at auto-parts companies that have struggled to secure enough semiconductors to keep up with resurgent new-car demand. Chip manufacturers have been unable to meet orders from other sectors that have thrived amid the pandemic, including makers of phones, tablets and other work-from-home devices.

While it’s too soon to say whether Stellantis would seek damages from auto-parts companies, Tavares warned he couldn’t rule out the possibility. Auto-electronics supplier Visteon Corp. flagged late last month that customers were pressuring the company to absorb some of the blow from the shortage.

Should a fix fail to materialize within the next few months, Tavares said automakers may take steps that would have “significant consequences” for suppliers.

“It’s in the best interest of tier-one partners to find a solution as fast as they can to prevent the carmakers from radically changing supply strategy,” Tavares said. Visibility as to how long the shortfall will last is “not so good.”

©2021 Bloomberg L.P.

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