Jul 30, 2021 | Shaoni Ghosh
An American electric vehicle and clean energy company, Tesla is trying to overcome the global chip shortage through the process of rewriting its software. The subsidiary, Tesla Energy’s products include a solar shingle system, solar panels, the Powerwall, Powerpack, which are energy storage systems scaling to a large extent.
Tesla not only generates renewable solar energy solutions, but also batteries. CEO Elon Musk states that this process shall support alternative chips.
One of the biggest issues occurring in the world of technology has been due to chips, which is one of the smallest components. The consequences have extended its hands and spread to such an extent that it goes beyond the complications while purchasing an Xbox Series X or PS5. As Musk observes, “The global chip shortage situation remains quite serious” which leads to terrible consequences such as factory shutdowns and higher prices".
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According to The Verge, Elon Musk stated, “We were able to substitute alternative chips, and then write the firmware in a matter of weeks,” and added further, saying “It’s not just a matter of swapping out a chip; you also have to rewrite the software.”. Even in the last three months, Tesla was able to provide more than 200,000 cars like General Motors, BMW, Daimler and so on.
But the global chip shortage has affected Tesla too, in various ways. In such a situation, rewriting won’t last long. Musk remarks that the future of Tesla will depend on a “swift resolution to the global semiconductor shortage.”
We have observed how Tesla is dependent on chips to power almost everything---the range varies from its airbags to “the module that controls...seatbelts.” Needless to mention, the airbags and seatbelts need chips. Musk also mentions that supply chain pressure cannot be avoided.
Tesla made exceptional profits in Q2 this year. According to Tech Story, the earning call observes that they “... broke new and notable records”, and that they “achieved an operating margin of 11.0 %. They also exceeded $1B of GAAP net income for the first time in our history.”
The thing is that there lies a difference between what the chief financial officer said and what Elon Musk stated. The former assured that Tesla would perform better in the upcoming months, but the latter sighed on the global chip shortage issue.