German semiconductor producer Infineon warned on Tuesday that microchip supply bottlenecks could continue into 2022, in a blow to the automobile industry. 

“We predict that the imbalance between supply and demand will continue for a few quarters yet, with the risk that it lasts into 2022,” said Infineon CEO Reinhard Ploss in a virtual press conference.

He added that the “bottlenecks” are a particular problem for the Munich-based company in areas where they do not produce the chips themselves, but buy them from subcontractors in order to equip micro-controllers for cars or smart appliances.

The automobile sector remains plagued by “severe delivery problems”, amid a rise in demand driven by a recent boom in electric vehicles, said Ploss. 

Infineon, which plans to finish construction on a new chip production site in Austria later this year, has profited in early 2021 from a booming semiconductor market.

While the surge in demand for electronic devices during the pandemic has helped chipmakers, it has also led to a semiconductor supply crunch in the automobile industry, where chips are a key element in modern vehicles.

The shortage of chips has pushed many automakers to idle production lines for brief periods when they temporarily run out of supplies.

According to Infineon marketing director Helmut Gassel, the shortage affected the production of around 2.5 million cars in the first quarter of 2021.