Report: Global manufacturing industry output to hit $41.9 Tn in 2021

Interact Analysis has released the latest update of the global Manufacturing Industry Output Tracker (MIO). The research shows that recovery in 2021 will be muted, following a far smaller contraction in 2020 than had initially been predicted. Meanwhile, the ongoing semiconductor shortage—coupled with the continued spread of the Delta variant, rising freight costs, and growing worker shortages—will create ongoing problems for all manufacturers. Per Interact Analysis, the semiconductor shortage can be attributed to several factors, but the biggest impact comes from the automotive industry. As automotive manufacturers scaled back production in preparation for an expected collapse in demand for vehicles, they reduced their orders for microchips. But the automotive slow-down was not as severe as had been feared, leaving vehicle factories unable to meet demand because their stocks of semiconductors were depleted. Demand for semiconductors then boomed as car factories suddenly ramped up orders, and now Interact Analysis predicts that the semiconductor market will suffer a steep dip in 2023 as the supply situation normalizes.