Chip Shortages Cause Security Concerns for Auto Manufacturers

An unforeseen side effect of the COVID-19 pandemic has been the many supply chain issues that are impacting organizations across industries.
auto chip shortages

Auto manufacturers have been hit especially hard, facing shortages of mechanical parts, semiconductor chips and other materials necessary to build vehicles. 

In a recent article on The Verge, Dr. Willy Shih, a professor of management practice at Harvard Business School, notes today’s modern cars could have more than 100 different chips designed to control things such as the engine, dashboard features, the navigation system, power windows and more.

And, if even one of those chips is out of stock, auto manufacturers cannot complete the vehicle.  

Rather than shutting down operations, though, manufacturing plants are forging on – assembling as many vehicles as they can, and then moving them to makeshift storage lots, where they sit until the necessary chips or other parts come in. Dr. Shih notes:

“If you’re an automaker, like one of the Big Three in Detroit, and you don’t have parts, those lines are usually producing about one vehicle per minute. So I think the average selling price for a vehicle now is over $40,000 recently. Okay, so that means every minute they’re losing $40,000 in sales. That’s a lot. So what they do is, they’ll take those vehicles out, park them in a field somewhere and hope when the chips come in, they can quickly go put them back in …”

– Dr. Shih

The Wall Street Journal reports that “General Motors Co. is storing thousands of new pickup trucks that lack chips or other components in airport parking lots near its Flint, Mich., plant. Ford Motor Co. parked new pickups at a race-car track outside of Louisville, Ky., while it waited for parts to complete the vehicles.” 

And this is now the norm for auto manufacturers across the country.

Makeshift Storage Lots Introduce Security Issues

Beyond the common problems associated with the supply chain shortage (e.g., disrupted operations and lost revenue), auto manufacturers that use makeshift storage lots are facing a new challenge: securing the unfinished vehicles residing there. 

There are several security issues with temporary storage lots:

  • First, most (especially those open fields) do not have any security measures in place.

  • Second, third-party parking lots, like those at airports or race-car tracks, might have some security, but there’s no guarantee that the property owners will prioritize the security of vehicles they don’t own. 

  • Last but not least, the price of rare metals and other materials found inside vehicles is skyrocketing, making them more attractive to thieves than ever before.

Take catalytic converter theft, for example. USA Today reports, “Before the pandemic, catalytic converter thefts had become pretty rare, averaging only 108 a month in 2018, according to the National Insurance Crime Bureau, a nonprofit that combats fraud on behalf of the insurance industry.”

Fast forward to 2021 and: “Thieves stole nearly 26,000 from January through May 2021, research firm BeenVerified estimated based on an assessment of the insurance crime bureau’s data and Google search reports. That would translate into a monthly average of more than 5,000.”

What this boils down to is this: Auto manufacturers are storing incomplete vehicles containing valuable parts coveted by thieves on insecure storage lots. 

And, this is a recipe for disaster.

Mobile Video Surveillance Solves the Security Problem 

Mobile video surveillance systems, such as Pro-Vigil’s, provide the ideal solution to auto manufacturers security challenges. They are self-contained units powered by solar panels, which means they can be connected without requiring electricity or WiFi.

They can be installed with minimal time (usually within hours) and effort. And, they can be deployed on a short-term basis – no long-term contract required. 

Given these benefits, mobile video surveillance systems are perfect for temporary security needs – such as makeshift storage lots – that don’t warrant the time, effort and expense of running electrical cables and setting up infrastructure for permanent surveillance.

Those open fields no longer pose a security risk, because mobile units can connect without infrastructure. And, even park lots that do have permanent or fixed video surveillance likely have blind spots that can be eliminated quickly with mobile units.

Auto manufacturers are facing enough problems with the supply chain shortage, don’t make security one of them. Contact Pro-Vigil today to see how we can help you resolve your temporary and long-term security needs.

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