The world has suffered from a drastic semiconductor shortage for the better part of the past two years. That has been mainly because of the early COVID-19 lockdowns that plagued many chip-producing countries. While many envisioned better days for the auto industry in 2022, that was before the conflict in Eastern Europe came to a head.
Related: Global Semiconductor Shortage — Everything automotive that you need to know
Now, it seems with Russia and Ukraine going at it halfway across the globe, consumers in Asia may have to bear the brunt of the conflict’s effects. European and Japanese brands alike, such as Mini, Toyota, and others, could have trouble keeping up with demand.
As sourced from a report by Automotive News Europe, Ukrainian neon production is essential to chip production. Estimates peg that about 70 percent of the world’s neon supply comes from Ukraine.
What does neon have to do with semiconductors? The noble gas is critical to running the high-powered lasers used for chip production. What makes things bleaker is that the Ukrainian neon industry relies on Russian steel.
The conflict in Eastern Europe could further aggravate the global chip shortage
Consumers in Asia could bear the brunt of an extended conflict in the region.
Autodeal on Mar 08, 2022You are here:HomeLatest StoriesNewsThe conflict in Eastern Europe could further aggravate the global chip shortage
The world has suffered from a drastic semiconductor shortage for the better part of the past two years. That has been mainly because of the early COVID-19 lockdowns that plagued many chip-producing countries. While many envisioned better days for the auto industry in 2022, that was before the conflict in Eastern Europe came to a head.
Related: Global Semiconductor Shortage — Everything automotive that you need to know
Now, it seems with Russia and Ukraine going at it halfway across the globe, consumers in Asia may have to bear the brunt of the conflict’s effects. European and Japanese brands alike, such as Mini, Toyota, and others, could have trouble keeping up with demand.
As sourced from a report by Automotive News Europe, Ukrainian neon production is essential to chip production. Estimates peg that about 70 percent of the world’s neon supply comes from Ukraine.
What does neon have to do with semiconductors? The noble gas is critical to running the high-powered lasers used for chip production. What makes things bleaker is that the Ukrainian neon industry relies on Russian steel.
Ukraine only purifies neon gas, but it exports it to countries across the globe. If the conflict escalates or goes on for an extended period, the world’s neon reserves may run out and consequently exacerbate the chip shortage.
Now neon suppliers are looking for alternative ways to procure the chemical element, but it isn’t as simple as it sounds. It will take time to shift production to other countries, and the supply chain logistics will be immense, but the alternative is going right back to where we were in the middle of the pandemic.
The world’s automakers reportedly have several months’ worth of neon reserves, but if the powers that be in Eastern Europe have plans for an extended conflict, we may be in for a challenging year in terms of semiconductor and auto production.
Related Articles
Toyota cuts May 2022 production due to parts shortage
Latest News
- Nissan teases its future product line at the Japan Mobility Show / NewsShaynah Miranda · Oct 14, 2025Nissan gives a look at what’s coming with the all-new LEAF and other future-ready vehicles at this year’s show.
- JETOUR Auto Philippines joins UAAGI brand portfolio / NewsAutodeal · Oct 13, 2025Renowned automotive powerhouse UAAGI continues to expand its lineup as it officially welcomes JETOUR Auto Philippines to its portfolio.
- Isuzu Philippines provides aid to earthquake-stricken San Remigio, Cebu / NewsJerome Tresvalles · Oct 13, 2025Isuzu Philippines and its partner Iconidc Dealership Inc. deliver relief goods to 200 families in San Remigio, Cebu.
Popular Articles
- Cheapest cars under P700,000 in the PhilippinesJerome Tresvalles · Sep 02, 2024
- First car or next car, the Ford EcoSport is a tough package to beatJun 18, 2021
- Car Maintenance checklist and guide – here’s everything you need to knowEarl Lee · Jan 12, 2021
- Most fuel efficient family cars in the PhilippinesBryan Aaron Rivera · Nov 27, 2020
- 2021 Geely Okavango — Everything you need to knowJoey Deriquito · Nov 19, 2020
- Family cars in the Philippines with the biggest trunksSep 20, 2023
- Head to head: Toyota Rush vs. Suzuki XL7Joey Deriquito · Oct 28, 2020
- Why oil changes are important for your carEarl Lee · Nov 10, 2020
- 2021 Kia Stonic — What you need to know about itJoey Deriquito · Oct 16, 2020
- Top 7 tips for buying a used car in the PhilippinesJoey Deriquito · Nov 26, 2020
