Disrupting Car Production Activities, Honda Indonesia Learns Chip Localization Opportunities

 The semiconductor chip crisis is becoming a major problem for the global automotive industry. 

In the domestic market, PT Honda Prospect Motor (HPM) said that the scarcity of semiconductors has an impact on production activities so that product fulfillment in consumers is hampered, even consumers must indent for up to 3 months for all new BR-V Prestige Sensing variants.

Public Relations & Digital Manager of PT HPM Yulian Karfili explained that the scarcity of semiconductor chips forced companies to prioritize models that have the highest demand in the market. Which means that some models from Honda must be thickened production activities.

Honda Indonesia

"So the strategy is to give production priority to models whose demand is already high. Inevitably, whatever we get (chip components) we produce first to maintain the stock of supply and demand levels to continue to be balanced," said Arfi, his nickname in a virtual talk on Tuesday (15/2).

Honda Brio which is the backbone of HPM sales is most prioritized production. Both facilities of Honda's assembly plant are now assigned to produce the maximum of the car.

While the most impacted model is the Low MPV Honda Mobilio, the unit in January 2022 yesterday was not even produced at all. However, next month the car is confirmed to enter the production kitchen again.

"What we are doing is having to prioritize production for models that are already high demand, one of which is Honda Brio. Brio demand is always high from consumers, currently every component comes we will prioritize first for Brio," he said.

Semiconductor Chip Localization

The strategy that HPM may pursue related to this scarcity, according to Arfi, is to study the opportunities of localization of semiconductor chips. That way, it no longer relies on the importation of components.

"There is a discourse on how we don't depend on importation. It's also one of the things we're learning, how the chip can be localized. Then how in the end when this problem is already running, production management is one of the most important," he said. 

Efforts made by HPM in order to supply product demand in the market is to find another chip supplier partner. He said, HPM will continue to maximize so that semiconductor problems do not drag on.

"The challenge for automotive itself is how we can maintain the supply of chips for our production. So we have to have options, we used to supply from a-b, now we have to supply from a, b, c, until d takes from elsewhere."

Chip manufacturers, arfi continued, are currently prioritizing chip fulfillment in electronic products such as smartphones and laptops. No wonder, in the midst of the COVID-19 pandemic these two goods are indeed flooded orders.

"Now it's arguably chip grabs, so electronics like mobile phones, laptops, and automotive need chips. Now back again how chip manufacturers are meeting all that demand. Automatic electronic components such as mobile phones and laptops are a priority for them, because many people have to do activities with virtual," he concluded.