{"id":58083,"date":"2022-12-06T10:30:38","date_gmt":"2022-12-06T18:30:38","guid":{"rendered":"https:\/\/electricalnews.com\/?p=58083"},"modified":"2022-12-06T10:33:27","modified_gmt":"2022-12-06T18:33:27","slug":"electronic-chip-shortage","status":"publish","type":"post","link":"https:\/\/electricalnews.com\/electronic-chip-shortage\/","title":{"rendered":"Electronic Chip Shortage Solution: Look to the Independent Channel"},"content":{"rendered":"\n<h6 class=\"wp-block-heading\" id=\"h-independent-distribution-channels-offer-quality-and-decades-of-experience-providing-manufacturers-of-automotives-the-electronic-chips-they-need-to-keep-production-running\"><em>Independent distribution channels offer quality and decades of experience, providing manufacturers of automotives the electronic chips they need to keep production running<\/em><\/h6>\n\n\n\n<p><br>Supply chain shortages have become a global issue, adding a stubborn wrinkle to the<br>fabric that keeps the economy humming. One shortage that has plagued the automotive industry since 2018 is the shortage of electronic chips. In automotives, chips control many of the features of a car, from heated seating to Wi-Fi hotspots, and without them, manufacturing cannot continue at the level consumers expect.<\/p>\n\n\n\n<p><br>Supply chain disruptions are nothing new; they have become something electronic parts<br>distributors have come to expect. With low-cost components in chronic shortage and extended<br>lead times for delivery, manufacturers are considering the use of independent distributors to get<br>parts on-time at the lowest possible cost without assuming additional risk. For many companies, sourcing parts from the independent channel requires a significant shift in mindset.<\/p>\n\n\n\n<p><br>\u201cSome companies make the decision to place orders with independent distributors the<br>very first day they are in operation because they understand our market and how we operate in<br>it,\u201d explains Mike Thomas, vice president and general manager at Classic Components, a<br>premier independent stocking distributor of electronic components based in Torrance, Calif. \u201cBut<br>there is an equal number of companies that are hesitant because the chipmakers and franchise<br>distributors have invested millions over the years to de-incentivize their customers from going to<br>the open channel.\u201d<\/p>\n\n\n\n<p><br>Keeping Automotive Manufacturing Running &#8211; At the pandemic\u2019s beginning, automotive<br>suppliers estimated a decline in consumer interest in purchasing a new vehicle and adjusted their projections accordingly. Chip manufacturers followed suit, prioritizing other sectors such as<br>consumer electronics as they anticipated a reduced automotive manufacturing capacity.<br>However, demand for new vehicles exceeded expectations, leaving the industry with unfulfilled<br>demand.<\/p>\n\n\n\n<p><br>The accelerated demand for chips in the automotive sector is going to remain steady for<br>some time, according to Thomas, due to the current backlog. This means the long-term prognosis for those manufacturing chips for automotives is positive. While things are beginning to slowly return to normal, at present, the price of hard-to-get components like chips has skyrocketed. The shortage has led to major car manufacturers eliminating certain features in newly made vehicles because they are unable to obtain enough chips to ensure full functionality. This is where having an independent distribution plan comes into play.<\/p>\n\n\n\n<p><br>\u201cIf you are a manufacturer, you need to have as part of your supply chain strategy an<br>independent distribution plan,\u201d says Thomas. \u201cHow are we going to engage? We don&#8217;t want to<br>give a broker business and take it away from the franchisor\/authorized distributors. But right<br>now, we are the guys that can be strategic and can get parts that work when you need them at a competitive price.\u201d<\/p>\n\n\n\n<p><br>Classic Components\u2019 sourcing expertise includes knowing where to find alternate sources<br>of component parts through surplus inventory, strategic relationships with other<br>franchise\/authorized distributors, and taking advantage of local and overseas markets.<br>For more information, contact Classic Components Corp at: <a href=\"http:\/\/www.classic-ic.com\">www.classic-ic.com<\/a>.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<figure class=\"wp-block-image size-medium is-resized\" id=\"https:\/\/electricalnews.com\/wp-content\/uploads\/2022\/12\/classic.jpg\"><a href=\"https:\/\/i0.wp.com\/electricalnews.com\/wp-content\/uploads\/2022\/12\/classic.jpg?ssl=1\"><img data-recalc-dims=\"1\" decoding=\"async\" src=\"https:\/\/i0.wp.com\/electricalnews.com\/wp-content\/uploads\/2022\/12\/classic.jpg?resize=300%2C150&#038;ssl=1\" alt=\"Classic Components\" class=\"wp-image-58084\" width=\"300\" height=\"150\" title=\"Classic\" srcset=\"https:\/\/i0.wp.com\/electricalnews.com\/wp-content\/uploads\/2022\/12\/classic.jpg?resize=300%2C150&amp;ssl=1 300w, https:\/\/i0.wp.com\/electricalnews.com\/wp-content\/uploads\/2022\/12\/classic.jpg?w=600&amp;ssl=1 600w\" sizes=\"(max-width: 300px) 100vw, 300px\" \/><\/a><\/figure>\n\n\n\n<div style=\"height:100px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Independent distribution channels offer quality and decades of experience, providing manufacturers of automotives the electronic chips they need to keep production running Supply chain shortages<\/p>\n","protected":false},"author":53,"featured_media":58084,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_cbd_carousel_blocks":"[]","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[6383],"tags":[],"class_list":["post-58083","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-products"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.9 (Yoast SEO v24.5) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Electronic Chip Shortage Solution: Look to the Independent Channel<\/title>\n<meta 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