[HN Gopher] Chip shortage leads carmaker Opel to shut German pla...
___________________________________________________________________
Chip shortage leads carmaker Opel to shut German plant until 2022
Author : t23
Score : 484 points
Date : 2021-09-30 17:26 UTC (1 days ago)
(HTM) web link (www.reuters.com)
(TXT) w3m dump (www.reuters.com)
| sytelus wrote:
| We are in for The Great Supply Crisis. This is everywhere from
| fuel to agriculture to chips. I believe the high level picture is
| that a significant percentage of labor force has decided not to
| return to work and that causes staffing crisis and that causes
| reduced outputs. Even though chip industry don't suffer from
| staffing, _their suppliers_ do.
| spoonjim wrote:
| Wouldn't carmakers instead buy capacity from people making USB
| chargers etc? I would think the cost of downtime would have them
| paying any price.
| simfree wrote:
| It takes 1 to 2 quarters for silicon to be manufactured, we are
| seeing the results of decisions that were finalized in early
| 2021 with regard to what is available today to buy.
| hristov wrote:
| Auto chips are usually a higher grade than consumer. They have
| to be able to handle wide ranges of temperature and moisture
| and also handle vibration. There is usually an extensive
| testing process until a chip gets qualified for auto
| production. This is especially true for chips used in the
| drivetrain and/or safety systems.
|
| There are some cases where a foundry is already qualified for
| an auto grade chip and they make a consumer chip in addition to
| it on the same equipment. They can stop making the consumer
| chip and devote 100% of their capacity to the auto grade chip.
|
| If that is a possibility, I am sure it is already happening.
| But a lot of foundries that make consumer chips simply aren't
| qualified to make auto grade chips, so they cannot move
| production.
| persedes wrote:
| Idk about recent years,but opel has already been looking at
| closing sites in Germany, Bochum I believe was the most recent
| one. This smells like an excuse to do so eventually (Whether
| justified or not)
| babypuncher wrote:
| I'm curious to see a more up to date analysis of the chip
| shortage. My understanding is that when it started last year, the
| problem was caused by unprecedented demand for silicon fueled by
| people being stuck at home. Factories were pumping out chips at
| maximum capacity and it still wasn't enough to meet demand.
|
| As people return to vacationing and social activities as the
| vaccine became available, I expected demand to slowly come back
| down to meet supply, but the problem seems to only be getting
| worse.
| 88840-8855 wrote:
| Edit: Too many downvotes for my view that this Opel case is yet
| another symptom of the wrong handling of the panedmic by any
| governments, leading to inflation and supply chain disruptions.
|
| If opinions are downvoted then I do not need to participate.
| imtringued wrote:
| Remember the 70s oil crisis? People stopped working because
| there wasn't enough energy to keep businesses and therefore
| jobs open. If there aren't enough semiconductors then those car
| factories won't stay open no matter what you do.
|
| Also regarding laying off people. Germany kept unemployment
| below 4% during the entire pandemic because of its more
| flexible labor market mechanism known as Kurzarbeit that allows
| people to work less during economic crises. The rigid labor
| market in the USA encourages employers to lay off entire people
| rather which tends to fuel recessions, make them worse and
| delay recovery. Just think about how inefficient it is to lay
| people off, pay them to do nothing, do massive state
| intervention through a rent moratorium and then hire them
| again. The unemployed still need housing and food. The idea
| that there is something more productive than producing food for
| them is laughable.
|
| >This would have been "mean" in the short-term, but good for
| the entire society in the mid- and long-term.
|
| I don't get it. Paying people unemployment benefits is the long
| term strategy. We give people food stamps because if they
| starve to death they won't be able to work at all. Even if they
| stay on welfare their children will have a better shot at life.
| Abandoning them is the height of short term thinking.
| Arainach wrote:
| >It would have been better to lay off people; many have money
| saved to survive a few months; others could have lend some
| money (and pay it back when employed again). This would have
| been "mean" in the short-term, but good for the entire society
| in the mid- and long-term.
|
| This is completely wrong and trivial to research:
| https://www.fool.com/the-ascent/research/average-savings-acc...
|
| Most Americans couldn't handle a $400 emergency. 56% have $5000
| or less in savings.
|
| These people have no one to borrow money from. This is one of
| the most insidious forms of privilege: It's much easier to
| "pull yourself up by the bootstraps" when you have a rich
| parent or uncle to loan you O(10000) to start a business or to
| give you food and shelter when you're down, but the VAST
| majority of people have no such resources.
| AnimalMuppet wrote:
| These aren't Americans, though. These are Germans.
|
| I don't know if the same statistics apply to Germans, but you
| at least need a different source to cite.
| imtringued wrote:
| The fun part about recessions is that demand for savings is
| going up and since the most popular savings vehicle is money
| it means demand for borrowers and debt is going up. The
| people who end up unemployed have absolutely zero capacity to
| borrow even though they are the ones who need it the most.
|
| Thanks to our moral frameworks we interpret strategies like
| Keynesian fiscal stimulus as some sort of bad drug that the
| economy is addicted to and should quit. There is a huge
| double standard here. People want money and they don't want
| anyone to go into debt. It's the height of hypocrisy. People
| demand debt and they vilify it at the same time.
|
| An amoral interpretation of Keynesian stimulus is that it
| effectively makes the debt market available to the
| unemployed. The unemployed are in debt in regards to the
| government which issues treasury bonds and the government is
| in debt in regards to the savers. In other words, it is
| decreasing market rigidity and decreasing overall market
| distortions.
|
| The reason why Keynesian stimulus is a bad idea has nothing
| to do with morals. Rather, the problem is that using the
| government to bypass market rigidities shows a deep
| underlying problem in the labor market that nobody wants to
| address.
|
| There are people who work more than they demand work and
| there are people who work less than they demand work. In a
| perfectly flexible market this should be impossible and you
| know what, it's impossible in a barter economy. People
| wouldn't work to pile up money that they don't intend to
| spend the same way a farmer wouldn't produce and pile up
| potatoes that they won't sell to the economy.
| lovich wrote:
| Replying to your edit.
|
| I didn't downvote you for your original response but holy hell
| the entitlement at
|
| > If opinions are downvoted then I do not need to participate.
|
| If you are incapable of accepting that people may disagree with
| your opinion, then yes you do not need to participate, but I
| don't know how you're gonna get through life if you pull out of
| any situation where there is disagreement
| neogodless wrote:
| https://news.ycombinator.com/newsguidelines.html
|
| > Please don't comment about the voting on comments. It never
| does any good, and it makes boring reading.
|
| However many downvotes you may have gotten initially, most of
| them are now for this reason.
|
| To the original comment, what exactly was the role of
| government handling in the automotive industries mishandling of
| their chip supply chain? How did these automotive industry
| missteps lead to inflation?
| winkeltripel wrote:
| You won't get downvoted just for having right-wing ideals, but
| you can't just assert controversial beliefs without backing,
| like "There shouldn't be a social safety net". The
| counterargument is simple: "I desire a high quality of life in
| my country, and that correlates with a social safety net. Most
| countries with high quality of life have excellent social
| programs: universal healthcare, universal youth education,
| robust unemployment [1]".
|
| [1] https://www.usnews.com/news/best-countries/quality-of-
| life-r...
| 88840-8855 wrote:
| "right wing ideas"? You must be kidding me. Are you one of
| those valley hackers who changed his gender 300 times and who
| is only wearing pink runes to protect his/her/its aura?
|
| Sorry, but not everything is "right wing", except ofc you are
| one of those "special kids".
| oblio wrote:
| First of all, your original comment was this:
|
| > I try to simplify the root cause like this:
|
| > - people kept getting money while not working
|
| > - those people did not work, hence, no goods were produced
|
| > Same amount of money without the goods in the market.
| Inflation and good shortages. I believe that those government
| helicopter money was a huge mistake. It would have been better
| to lay off people; many have money saved to survive a few
| months; others could have lend some money (and pay it back when
| employed again). This would have been "mean" in the short-term,
| but good for the entire society in the mid- and long-term.
|
| Secondly, you're wrong. The shortage has nothing to do with
| "government helicopter money". It has to do with changing
| spending habits due to the pandemic plus companies
| anticipating, wrongly, where those changing habits will lead.
| And that's topped off by the fact that the electronics supply
| chain is not agile, so once you change your mind, you can't
| really go back quickly.
|
| Your opinion is downvoted because you're wrong.
| 88840-8855 wrote:
| I think you are wrong.
| oblio wrote:
| https://www.bbc.com/news/business-58230388
| TheGigaChad wrote:
| Chad answer.
| TheGigaChad wrote:
| The soylets cannot handle the truth, so they downvote :(
| folli wrote:
| Any proof that there's a significant inflation ongoing?
| 88840-8855 wrote:
| CPI in Germany
| puzzlingcaptcha wrote:
| Well, since January the US CPI rose by 4.4% and there are
| still 4 months to go (September data is released in two
| weeks). The Fed target is ~2%.
|
| That's before you get into whether the official number is
| underestimated (e.g homeowner's equivalent rent, which is a
| quarter of the CPI basket). Is it significant? Maybe, maybe
| not.
| oblio wrote:
| Inflation is growing everywhere. You can't have a crisis and
| then dump that much money without inflation happening.
|
| Besides CPI, the main inflation is actually asset inflation.
| Look at the huge stock, real estate, etc. price booms since
| 2020.
| lovich wrote:
| The people not producing goods weren't doing so out of laziness
| or some bureaucratic snafu. They weren't producing goods
| because there was a pandemic and getting physically near others
| was dangerous.
|
| If you think those furloughed workers shouldn't have gotten any
| money sue it would be "good" for the long term system, then
| might I suggest as a modest proposal that you simply toss them
| into a meat grinder? Very simple and removes the people
| spending too much money from the economy
| tibbydudeza wrote:
| They used to be big back in the day when hot hatches ruled and we
| had Golf vs Astra (Vauxhall for the UK) but then we got
| crossovers and mini-SUV and GM had their own problems to invest
| in the brand.
|
| Nowadays they make rebadged Peugeot/Citroen cars.
| mprev wrote:
| I'm no fan but it's reductive to call them rebadged Peugeots.
| Like just about any car you buy, including a Rolls Royce, they
| are built using a shared platform. In this case, it's one of
| the Stellantis platforms.
| gsnedders wrote:
| Rolls Royce has actually been moving _away_ from shared
| platforms; only the Wraith and Dawn (both in their final year
| of production) are on a shared platform.
|
| Certainly there's still shared components with BMW, but
| they've gone back to being more bespoke.
| zz865 wrote:
| Opel used to be owned by GM since 1931.
|
| From Wikipedia: "In the 1990s, Opel was considered to be GM's
| cash cow, with profit margins similar to that of Toyota. Opel's
| profit helped to offset GM's losses in North America and to
| fund GM's expansion into Asia"
|
| The GM bankruptcy contributed to Opel downfall.
|
| It makes PSA cars because PSA bought them in 2017.
| dpe82 wrote:
| Are you suggesting the plant closure is due more to waning
| popularity of their cars rather than availability of parts?
| rsynnott wrote:
| Stellantis, the controlling company, is more or less an
| aggregation of all those car brands which makes you go "wait,
| _they're_ still in business?!", so, I mean, it's kind of
| plausible.
| MrRiddle wrote:
| Unpopularity probably affects their negotiating abilities.
| throwaway0a5e wrote:
| Unpopular doesn't mean bad sales numbers.
|
| If you listen to the white collar internet you'd think that
| nobody buys Nissan and FCA (I'm sorry, _Stellantis_ ) but
| that couldn't be further from reality.
| Macha wrote:
| Opel annual sales in 2019 was 800k, half their peak of
| 1.6 million in 1999 and there sales graph is basically a
| steady continuous drop in that period:
| https://carsalesbase.com/europe-opel-vauxhall/
|
| The people who historically would have bought Opels or
| Vauxhalls (thanks to high numbers of UK imports, you used
| to see both here) now tend to buy Toyotas and Kias mostly
| today, at least in my country.
| fy20 wrote:
| Opel is owned by one of the biggest car manufacturers in
| the world now, so it's more likely they are diverting parts
| to their more popular brands.
| MrRiddle wrote:
| Probably, same principle though.
| _trampeltier wrote:
| Opel Manta .. they made even movies about two movies about it
| :-)
| overhero wrote:
| opel rekord is the real deal, man.
| tibbydudeza wrote:
| Lotus Carlton.
| tibbydudeza wrote:
| Cheesy German movies from the 80's.
| chrismeller wrote:
| Heh. I was thinking the same thing: "yeah, so what if they do?"
|
| Horrible shame, that lack of Opels.
| baybal2 wrote:
| The aspect of the problem not talked about is that a lot of
| automotive chips are really, really old.
|
| And they are old, because of many certification requirements set
| partially by the industry, and a few odd governments.
|
| In reality, most of them are both less reliable, and harder to
| work with in comparison to open market parts.
|
| The only two things I seen chips with micron scale nodes used in
| my life were: air conditioner boards, and car parts.
| xondono wrote:
| It's true that the auto market tends to be behind the times,
| but regulation is not the cause. That is much more of an issue
| in airplanes and aerospace in general.
|
| Cars still use micron level chips because:
|
| - They still do the job.
|
| - They have enough volume to keep those fabs open.
|
| - Since they end up becoming the only buyer (monopsony), they
| get cheap rates.
|
| So they pretty much run those fabs to the ground.
| AnimalMuppet wrote:
| Cars are a _really_ noisy electrical environment. Can you
| replace that micron-scale chip with a 7 nm chip and have it
| function reliably for two decades in that environment?
|
| I mean, worst case, when you let go of the starter motor, it
| creates a huge back EMF. Imagine your chip finding its +5 input
| suddenly 12 volts _below_ ground for a significant fraction of
| a second. (Now, it shouldn 't be that bad any more. That was
| back in the bad old days, when chips were just starting to be
| added to cars. Shielding should be a mostly-solved problem
| these days. But is it solved well enough for your 7 nm chip, or
| just well enough for the micron-scale chips? It's something you
| have to _really carefully_ look at before you move to smaller
| processes.)
| baybal2 wrote:
| > Cars are a really noisy electrical environment. Can you
| replace that micron-scale chip with a 7 nm chip and have it
| function reliably for two decades in that environment?
|
| For as long as you talk about digital side, you can. Your
| smartphone is a way more noisy electrical environment than
| your car.
| xnyan wrote:
| >Your smartphone is a way more noisy electrical environment
| than your car.
|
| Cellphones are are certainly tricky, but in a different way
| than cars. In my experience with EMF measurement and EMI
| compliance at Underwriters Labs, cars are uniquely
| challenging due to the relatively strong EMF generation
| from the huge number of motors, solenoids, coils other
| magnetic bits banging around and interacting with each
| other in hard-to-predict ways.
| baybal2 wrote:
| High voltage CMOS is certainly needed there of course,
| but you don't put you logic chip on the same die as a
| motor inverter.
| Noted wrote:
| I don't think smartphones are expected to work on the same
| timescale that a car should.
| InitialLastName wrote:
| Misunderstandings about noise in digital systems and
| environmental conditions in smartphones vs cars aside
| (well, no: your phone isn't operating at 100C or vibrating
| in anything like the way a car does), your smartphone
| doesn't run reliably (relative to automotive reliability
| requirements) for a day.
|
| When a failure can kill someone, you have to take it much
| more seriously than when a failure slightly inconveniences
| a user while they restart the app.
| throwaway9870 wrote:
| First, there is no such thing as digital. It is just an
| abstraction to facilitate our understanding and design of
| circuits. Any number of issues can cause that abstraction
| to fail, even deep within a modern chip, let alone at the
| board level. On-chip cross talk, RC drop, and ground bounce
| are simple analog issues that have to be contended with on
| digital designs. Every chip has a power supply and the
| smaller geometry chips have less tolerance to supply
| spikes. Same with I/O including voltage range tolerances
| and ESD protection. All that gets harder in smaller
| geometries. Also factor in circuit lifetimes (including
| digital). Due to a variety of mechanisms, small geometry
| chips just are not as reliable and some of these mechanisms
| are very hard to accelerate so qualification is a
| nightmare.
|
| A smart phone is not a "way more noisy" environment than a
| car. It has different issues, and frankly a far more
| constrained and predictable environment. A load dump event
| in a car can take the 12V supply over 100V. I have never
| heard of that in cell phone. Long wiring harnesses are a
| nightmare and require careful design. It is hard to compare
| a cell phone and car without a clear definition of "noisy",
| but as someone who has designed systems similar to both, I
| think the car is a harder set of problems. Just not as
| constrained noise sources or components.
| caeril wrote:
| What I'll never understand is why carmakers don't take advantage
| of this situation and address a market that's been literally
| BEGGING for decades for a new product:
|
| A simple, basic car, with the ONLY electronic control being for:
|
| - Valve timing - Fuel injection - Oxygen and throttle - Emissions
|
| There's a market for budget and privacy oriented customers that
| all carmakers seem to have ignored for two decades now. Give us a
| simple car with no GPS navigation, ass warmers, tire pressure
| sensors, telemetry, backup cameras, USB chargers, proximity
| detectors, traction control, keyless entry, remote climate
| control, etc.
|
| But instead of addressing this market, these carmakers have
| decided to throw up their hands and shut down production or pile
| up unfinished inventory waiting on chips. It makes precisely zero
| sense.
|
| I understand the re-engineering is a cost. But when you're simply
| removing existing features, this should be a fairly negligible
| one.
|
| edit: I wasn't aware any of these luxury features were mandated
| by governments. Apologies, and disregard.
| chefkoch wrote:
| >A simple, basic car, with the ONLY electronic control being
| for:
|
| - Valve timing - Fuel injection - Oxygen and throttle -
| Emissions
|
| You still need electronics for
|
| - ABS - ESP - Airbags (- Diagnostics)
|
| Because these are mandated.
|
| Buy a cheap Dacia and there won't be much else except electric
| windows.
| paganel wrote:
| I found that one can live without ESP.
|
| > Buy a cheap Dacia and there won't be much else except
| electric windows.
|
| As mandated by EU law the latest Dacia models already have
| most of those, they do have back up cameras, for example.
| NathanielK wrote:
| > I found that one can live without ESP.
|
| True, but on average ESP is highly effective. Cars with ESP
| are correlated with 40-50% less running off the road or
| roll over crashes.[0] Carrie Underwood may sing about Jesus
| Taking the Wheel[1], but she really has GM Stabilitrak to
| thank.
|
| [0] https://crashstats.nhtsa.dot.gov/Api/Public/ViewPublica
| tion/... [1] https://www.youtube.com/watch?v=lydBPm2KRaU
| windowsrookie wrote:
| In the United States backup cameras, tire pressure monitors,
| and electronic stability control are required by law.
|
| So out of your list that leaves..
|
| GPS (already optional on most cars) Ass warmers (already
| optional on most cars) Telemetry (this could be removed from
| models that have it, not all cars sold today have telemetry)
| USB chargers (really don't think USB chargers are causing a
| production shortage at this moment) Proximity Sensors (already
| optional on budget cars) Keyless entry (could be removed, I
| doubt many people would buy a new car without keyless entry
| tho) Remote climate control (already optional on budget cars)
| mrweasel wrote:
| I tried to buy a car without AC, but as it turns out that's
| almost impossible. They had never imported that model without
| AC and the waiting time was pretty long, because they where
| not really built in large numbers.
|
| The models without AC mostly exist so they can produce ads
| saying "available from less than X"
| CamperBob2 wrote:
| What's the point of buying a car without A/C? You might
| save $1000 now, but you'll lose several thousand at trade-
| in time because no one else will want your car.
| ok123456 wrote:
| No parasitic power losses and it's one less system that
| needs to be maintained.
| tms2x2 wrote:
| AC is used for windshield defrost. I remember waiting for
| heat to defrost the windshield so I could see. AC defrost
| works in 10 sec.
| mensetmanusman wrote:
| For driving indoors.
| CamperBob2 wrote:
| I'm trying to think of a case where regular passenger
| cars are driven in climate-controlled indoor settings,
| and I'm not having much success. What do you have in
| mind?
| mrweasel wrote:
| That depend on your country. I would save closer to $2500
| on the budget model. Other than that you are completely
| right.
| thriftwy wrote:
| What's the point of keyless entry? Mine comes with key, and
| yhe auxiliary immobilizer which will not let it drive without
| radio tag or typing in PIN.
| Ekaros wrote:
| Ease of use. I would love if I could just leave key in my
| pocket and not worry about opening doors or putting it in
| ignition. I could even connect it to my keychain.
| [deleted]
| thriftwy wrote:
| I wonder if nobody did ssh+nfc keys yet. At least I could
| trust it.
| SilverRed wrote:
| The security of key fobs is not a great concern when the
| windows can still be smashed.
| vdfs wrote:
| Key fob allow you to start the car engine, it should be a
| concern
| Ekaros wrote:
| SSH+NFC sound like horrible protocol choice for such
| token.
|
| Not that I would be against option to periodically rekey
| the whole system. Generate new pair of private keys and
| have the car and key swap them with my approval.
| thriftwy wrote:
| You don't need to ever rekey an SSH private-public key
| pair. Still, a single hands-free token can be taken by
| force or stolen.
| Ekaros wrote:
| So can car key... I don't really have a car and probably
| never will were I truly worried that it was essentially
| single factor authentication.
| thriftwy wrote:
| But the car key + separate wireless immobilizer token is
| 2FA and it makes me somewhat confident.
|
| WRT keyless entry, I actually have figured it out.
| Central wireless lock is cool. It's keyless start that
| I'm opposed to.
| Ekaros wrote:
| And how often you keep those separate and operate the
| car? Can you even safely store one in safe place and
| still use the car? Or is there more factors. Which then
| increases the potential failure cases. And I prefer
| really not to involve anything like pin codes,
| fingerprints, facial recognition needed for me to drive
| my own car.
| thriftwy wrote:
| Fingerprints and facial recognition is circus, but
| physical token is a real thing, and I do keep it separate
| from my car keys
| quacked wrote:
| I disagree with most of the people responding to you; I think
| if Toyota re-released the 2000 Tacoma with minor updates to the
| stereo system and a webcam on the back they'd do a billion in
| sales.
| elorant wrote:
| So what about airbags? Or ABS? Those are basic safety features
| that cannot work without electronics.
| javanscala wrote:
| I believe backup cameras and TPMS systems are now mandatory for
| US cars, so some of the complexity is mandated at least for
| "production" vehicles.
| mymythisisthis wrote:
| I think that keyless systems came after few incidents of
| people's key chains being too heavy and accidentally turning
| the car off when hitting a bump on the highway.
|
| Since most cars keys already, from the late 90s, had chips in
| them, to prevent theft. It was the next step to remove the
| superfluous metal part.
| foobarian wrote:
| I love keyless entry. I can approach the car with two hands
| full of bags and still manage to open a door or trunk without
| having to free up a hand just so I can rummage through
| pockets to find the keys.
| bserge wrote:
| I want something (exactly) like a Ford Escort 1988 model with
| the 1.6 diesel (Ford LT "Dagenham") engine.
|
| That thing would work long after a massive solar flare _and_
| nuclear apocalypse... If it wasn 't rusted to shit.
|
| So yeah, better alloy/treatment for the frame :D
| JudasGoat wrote:
| I personally wish that the infotainment part of the vehicle was
| a interface cable where the customer could freely choose the
| platform and also have an upgrade path in the future. Making
| cars more like cell phones means they will assume the lifetime
| of a cell phone.
| dfadsadsf wrote:
| That's already exist - Apple Carplay/Android Auto. Gets
| better with every iOS release and app update. First thing i
| do when i get in the car is plug my phone in and support for
| wireless Carplay will be major factor in my next car
| purchase.
| paxys wrote:
| Almost everything you have mentioned are expensive add-ons. Any
| budget base model car today comes only with stuff mandated by
| law and little else.
| pickle-wizard wrote:
| Good news, you can buy this car today. It is called the
| Mitsubishi Mirage. Hardly anyone buys it because it is an
| absolutely dreadful car to drive.
| gnopgnip wrote:
| Some side by sides or UTVs are pretty close to what you are
| asking for. As these vehicles are not universally road legal
| they don't have many requirements, it is really up to the
| market. Many are under $10k and have relatively few
| electronics. Some of them can be operated on public roads at
| lower speeds. And when you are no longer designing a vehicle
| for 70-90+ speeds you can make a lot of other changes, engine
| 1/4 the size, lighter wheels, brakes, frame while still being
| able to tow as much as a mid size suv.
| outside1234 wrote:
| You probably want ABS as well - and then everyone else will
| want their favorite feature - and pretty soon we'll be where we
| are.
| bigmattystyles wrote:
| Every time I hear about self-driving, I just think how bad
| every media system UI and functionality of BT, etc. in cars
| have ever been. I know it's probably different teams and much
| stricter standards for self-driving but all I ever think when
| using my Mazda's media center is 'fast chance I trust this team
| with self driving'. As far as media centers go, just make apple
| carplay / android auto standard...
| k8sToGo wrote:
| You are welcome to buy the most basic Dacia at any time
| mlavin wrote:
| Buy an old Dodge W250 with a 12-valve Cummins 6BT, and enjoy
| mechanical fuel injection and 160 hp. No emissions control, no
| timing chain or belt, no overhead cams, no aluminum block or
| heads, ABS is optional, no airbags.
| hristov wrote:
| First of all this "simple" car may end up being more expensive.
| Doing a lot of the things the old mechanical way requires a lot
| of labor and labor is expensive nowadays. Having to use turning
| wires and vacuum tubes for instrument clusters, and a bunch of
| pull wires for controls... Not only would that be expensive it
| would require skills and equipment long lost today. Oh and the
| wind shield wipers -- it is possible to power wind shield
| wipers mechanically but those were some very complex rube
| goldberg type mechanisms.
|
| Furthermore, this "simple" car will not last very long. People
| have forgotten that nowadays, but in the old times of "simple"
| mechanical cars, cars used to break down much more often and
| require much more skilled maintenance.
|
| Most people would not know how to use it. Do you think people
| will be able to handle an unassisted wheel? You know, actually
| use their muscles to turn the wheel when parking? How about
| unassisted brakes? You get into a dangerous situation, you slam
| on the brakes and then it turns out that you have to use your
| muscles to actually apply sufficient force. How about even
| getting into the car without a radio key fob. I very much doubt
| the majority of people will even know how to lock or unlock
| their rear doors without a central lock/unlock key. They will
| probably just leave their car unlocked.
|
| But most importantly, it wouldn't sell. Cars nowadays sell
| based on electronic features. You can see that from the
| commercials. Even fairly advanced features like navigation and
| parking sensors are considered a must have now.
| DevoidSimo wrote:
| I've driven my car with only enough battery to really power
| the spark plugs and instruments in the dash (alternator
| failed and I got jump started). It was manageable even with
| the heavy steering, although to be fair I was driving max
| 50kph. Perhaps braking at highway speeds would be
| challenging.
|
| I also much prefer my phone navigation over the in car system
| (Android Auto/Apple Carplay would solve this). That said, I
| wouldn't buy the car GP is suggesting, but I could imagine
| that if you were price sensitive then you might.
|
| No comment around the older systems, I don't really have the
| knowledge to agree or disagree there.
| ahoka wrote:
| OP said "electronic control" not electronics, not the same!
| If you have an analog control on the dashboard directly
| connected to the heater element than it is electronic, but
| not electronically controlled.
| bambax wrote:
| > _But most importantly, it wouldn 't sell._
|
| You don't know that. I'm pretty sure there is a market for
| simple cars that don't tell you what to do, don't report you
| to the authorities, don't shut down unexpectedly because you
| didn't follow the manufacturer's maintenance schedule, etc.
|
| > _How about even getting into the car without a radio key
| fob. I very much doubt the majority of people will even know
| how to lock or unlock their rear doors without a central lock
| /unlock key. They will probably just leave their car
| unlocked._
|
| I can't tell if this is satire or not, but people who can't
| open a door with a key and a handle maybe shouldn't be
| allowed to drive.
| Gravityloss wrote:
| So true. Computing is very cheap nowadays. It is also very
| reliable.
|
| If you watch Sandy Munro's videos, he mentions often how his
| visits with Chinese car manufacturers go, when they discuss
| architecture options. Customers hold up a cell phone and ask
| "How can we make it more like this?". The cell phone got rid
| of separate components a long time ago. Everything's on one
| PCB, plus the display. And many things that used to be on the
| PCB but consisted of many chips, are now integrated to a
| single chip. The car consisting of a lot of OEM boxes
| connected with wires seems so outdated.
|
| And each box having a separate computer makes it in essence
| stranded. Instead, if the control is centralized, then it's
| possible to take the complexity to software and keep managing
| it much better, features are easier to develop and can be
| sent to existing cars over the air etc.
| teeray wrote:
| > cars used to break down much more often and require much
| more skilled maintenance.
|
| Yeah, but "skilled maintenance " was an easy skill. There
| could only be a handful of things wrong if it didn't start:
| e.g. no spark, no fuel. In the case of no spark, you check
| the plug, see if it's dirty, change it if so; check the
| distributor, maybe the points are bad; check the coil or
| condenser... yeah there were things to check, but you could
| actually fix it once you learned about it. And yes, you could
| do this on the side of the road--there were "tool rolls" you
| could have for such purposes.
|
| Now, you get a check engine light and the code reader says,
| in so many words: "bring to dealer and pay up"
| abraae wrote:
| When I was a lad I had an illegal ancient motor scooter
| that didn't start. One of the dads told me:
|
| "If it's got compression, and it's got fuel, and it's got a
| spark, then it's got to go".
|
| He was right.
| markrages wrote:
| Just wait until you get a sheared pin on the distributor
| drive... Compression, fuel, spark, no go.
| hef19898 wrote:
| And how often does that happen with modern day cars
| compared to old ones? I would argue that older cars, pre
| electronic wizardry, are easier to repair (assuming spare
| parts are available) but break down more often. Older cars
| are also in need of more maintenance.
|
| Modern cars need an inspection every 30k km and hardly ever
| break down. When they do, they are usually toast so (at
| least financially). Older cars are financially toast as
| well, if you cannot do the work yourself so.
| tibbon wrote:
| One of my motorcycles is from 1973. Nary a tube or chip on
| it. I think it's got a turn blinker that's kinda a flip-flop,
| but I think it's just charging and discharging capacitors.
| It's lasted way longer than most modern disposable vehicles.
|
| I don't know if most of these things actually require digital
| features.
| brewdad wrote:
| You say "one of" your motorcycles, so I take it you aren't
| riding this bike everyday, putting 12-15,000 miles a year
| on it and needing it to be reliable every time you go to
| work or run an errand.
|
| Apples to oranges comparison.
| TomVDB wrote:
| Does that motorcycle pass modern emission requirements?
|
| The engine controle unit plays a major role in emission
| control and fuel economy.
| paulryanrogers wrote:
| But how many parts of it are original? In other words is it
| the ship of Theseus? Does it pass e-check or is it exempt?
|
| Regardless I do appreciate the simplicity of long past
| inventions.
| [deleted]
| doctorshady wrote:
| I have an early nineties car like the parent describes;
| processor controlled fuel injection/valve timing/other core
| engine routines, and that's pretty much it with the exception
| of windshield wiper control and the radio. Practicality of
| making a car like that today aside, it's remarkably well
| built, and I have no problem believing it'll last at least
| another five years.
| WaitWaitWha wrote:
| That maybe true, but my anecdotal evidence is the opposite.
|
| > cars used to break down much more often and require much
| more skilled maintenance.
|
| My '78 John Deere 4640 (not a car I give you that) if it
| breaks down, I can fix it. If I cannot I can order the part.
| If I cannot, I can have the part made within a week.
|
| None of that is possible with a 2021 6145M. If it breaks, I
| have to sit and wait for JD to bless me with their part.
|
| I have _less problems_ with non-electronic equipment than
| with the electronics enhanced ones.
|
| I venture it is very much the same with personal cars.
| ashtonkem wrote:
| Anecdotes are always a mistake in these situations. You
| might have better luck with your _tractor_ , which isn't a
| car, but the average age of cars on America's roads has
| been rising for decades. Your experience is, frankly, an
| outlier.
|
| Also, comparing tractors with cars is an extremely dubious
| proposition; these are different vehicles with different
| engineering constraints, uses, and consumer expectations.
| How many OEMs for cars still make parts for the 1978
| vehicles? Hell, what percentage of Americans have the
| space, knowledge, and interest to build up a garage to
| service their own vehicles?
| newsclues wrote:
| Just wait until the new generation of cars with
| touchscreens everywhere instead of buttons and knobs for
| control are old.
| ashtonkem wrote:
| Do you have any actual data to back up the idea that
| touch screen interfaces are inherently short lived?
| Eduard wrote:
| So many smartphones with digitizers having dead zones
| after just four years....
| ashtonkem wrote:
| Car screens are built to different tolerances than cell
| phones. In particular they must survive a much more harsh
| environment than most other consumer electronics. This is
| precisely why the first Tesla screens were so shocking in
| their size and so unreliable; when Elon Musk found out
| that he couldn't get auto screens that large he demanded
| they use consumer screens, which yellowed and failed due
| to the heat cars are exposed to. Car screens and normal
| screens are _not_ the same, at all.
|
| This situation is _exactly_ the same as the tractor
| example above. You're taking a similar but different
| object built for different use cases and different
| financial and engineering constraints, and declaring that
| the outcome of one is predictive of another.
| newsclues wrote:
| I'm not referring to the big screens but the replacement
| of buttons and knobs with multiple small ones.
|
| Like putting touch screens on the steering wheel!
| ashtonkem wrote:
| How many vehicles do that though? I can only think of
| Tesla, and they're already pretty notoriously unreliable
| straight from the factory. All of the vehicles I've been
| in, including at trade shows, had physical buttons for
| most of the vehicle functions, and touch screens for
| secondary and tertiary operations.
| vkou wrote:
| > My '78 John Deere 4640 (not a car I give you that) if it
| breaks down, I can fix it.
|
| That's great, but _I_ don 't own a garage, and if my car
| breaks, it goes to the mechanic. The mechanic needs to eat,
| and pay the mortgage on _her_ garage, so she will charge
| $XYZW for repairs.
|
| For all the maintenance and repair work I and my father
| have had done on our cars, 'Some microchip somewhere
| crapped out' has never made the list. All the failures have
| been purely mechanical. Your 70s car proposal solves a
| problem that few people have, and introduces a lot of new
| ones.
| markb139 wrote:
| Indeed. We have an aging Audi that has adaptive cruise
| control. Recently the radar unit failed. To get it replaced
| at a dealer will cost about half of what the car is worth.
| sigstoat wrote:
| what, on an aging audi, _doesn't_ cost half the value of
| the vehicle to fix?
|
| i've heard the same complaint about basically every part
| of an audi except the tires.
| gmac wrote:
| Audi seems to be the brand for people who want a VW, but
| want to pay extra for it. It's like the mirror image of
| Skoda or SEAT (VAG's more 'budget' brands).
| nradov wrote:
| This is why it's foolish to purchase a German luxury car,
| either new or used. The electronics aren't designed to
| last any longer than the warranty. If you really want to
| drive one then lease, don't buy.
| kenniskrag wrote:
| tire pressure sensor, gps and e-call is needed by law.
| paganel wrote:
| Maybe we should amend/change those laws back.
| cedilla wrote:
| Perhaps we shouldn't.
|
| The EU estimates that half the fatalities on the road will
| be prevented with these systems. That's 10.000 lives each
| year. If that's true, increasing the cost marginally is
| more than worth it (and it really is marginally, budget
| cars have not noticably increased in price).
| paganel wrote:
| > budget cars have not noticably increased in price
|
| Actually, they did. The new Dacia Logan starts at 8500
| euros, back in 2009 you could buy an entry-level one at
| about 5500-6000 euros, which would be around 6400-7000
| euros in today's money. At those entry level prices those
| extra 1500-2000 euros do count.
| AdrianB1 wrote:
| They probably estimated from behind a desk to justify
| some activity, not by research. Over 90% of the
| fatalities on the road in my country, that has the
| highest numbers in EU, come from excessive speed and
| ignoring road laws, something no current safety systems
| can change. Even airbags are completely useless in a
| front collision at 150km/h.
| realityking wrote:
| Good news, the EU realizes that as well. Starting May
| 2022 all new cars sold in the EU need to support
| Intelligent Speed Adaptation:
| https://www.cnet.com/roadshow/news/european-union-speed-
| limi...
| JTbane wrote:
| Those systems are good for idiot-proofing. You don't want
| some idiot with underinflated tires running off the
| highway. In the same way, you don't want them to back over
| your kid in a parking lot.
| fomine3 wrote:
| I didn't know TPMS is mandatory in US and EU about a decade
| ago. It's still not mandatory in Japan so most cars except
| luxury or imported don't equip it. Maybe vehicle inspection
| program (shaken) for every two years helps to avoid using
| worn tires. Also maybe due to less people use run flat tires
| than US/EU, or roads in Japan is better.
| paxys wrote:
| And rear view cameras
| _moof wrote:
| And I'm not sure what kinds of pressure sensors cars use, but
| I can tell you the ones I need have been impossible to source
| for months.
| emidln wrote:
| TPMS works by calculating the RPM of the wheel and knowing
| the tire size and vehicle speed. Most TPMS setups don't
| know the actual pressure, they infer it.
| tschwimmer wrote:
| This is true of cheaper cars, like my Honda. German cars
| like Audis and Porsches have direct TPMS that can
| actually tell you the exact tire pressure.
| matli wrote:
| Most Audis have indirect systems, but they have direct
| TPMS as an optional extra. At least that's the case on
| the European market, unsure about the US market. Some
| premium Audis also have loose wheel detection, which is
| based on a similar technology as the indirect TPMS.
| lastofthemojito wrote:
| Both types of systems exist, but from what I've seen the
| indirect TPMS systems you're describing are becoming less
| popular. I'm somewhat familiar with Mazdas anyhow and
| that's the way it's going with them.
|
| For 2017 the Mazda6 used an indirect system: https://www.
| mazdausa.com/static/manuals/2017/mazda6/contents...
|
| For 2020 it's a direct system with in-tire sensors: https
| ://www.mazdausa.com/static/manuals/2020/mazda6/contents..
| .
| _moof wrote:
| Oh, interesting. Well, my car at least has sensors--
| either that or I paid way too much for valve stems. :)
| clintonb wrote:
| Is the _market_ begging, or a few folks on the internet? The
| only folks I know that complain about technology in cars are a
| couple posters on internet forums.
| caeril wrote:
| Sure, lots of internet people who don't want to be tracked
| (license plate readers notwithstanding).
|
| But also _plenty_ of IRL people complaining about how, for
| example, they miss their $10k pickup with no power anything
| that worked great for anytime they needed to haul material X
| from location M to N, but now you need to drop a _minimum_ of
| $50k for a vehicle you might use once per weekend to haul
| gravel, insulation, cement, lumber, furniture, etc.
|
| Trucks are a particularly big market for this idea. It's a
| vehicle you use when you're _already_ dirty and sweaty from
| work /projects and don't care about comfort, and serves a
| primary purpose: moving heavy and/or large items.
|
| But the big carmakers have opted to cater to the market that
| doesn't actually use trucks for their actual purpose, but
| rather the market that buys trucks as commuter vehicles.
| jdmichal wrote:
| Ignoring everything else, that new truck is much larger.
| Compact trucks have not really existed in the US market for
| a decade at least.
|
| An old Ford Ranger was 175-200 inches long depending on
| year and model. The new one is 200-210 inches.
|
| Sort this list by class and you'll see a total of two
| compact trucks in the US market. Both are debuting either
| this year or the next: Ford Maverick (200") and Hyundai
| Santa Cruz (195").
|
| https://en.wikipedia.org/wiki/List_of_pickup_trucks
| s0rce wrote:
| Those new "compact" trucks are sadly still 2ft longer
| than old compact trucks from the early 90s. Can't get
| anything small anymore.
| beamatronic wrote:
| I would love a stripped down 1990's-era Toyota truck
|
| https://www.thedrive.com/news/42523/84-mile-1993-toyota-
| pick...
|
| But not for 50k
| yardie wrote:
| You can still get a stripped down, plain white F-150 for
| under $27k through fleet sales. But buyers don't want that.
| They want the 4-door people hauler that happens to have a
| pick-up bed and leather seats.
|
| They'll imagine the $10k from memories but forget the vinyl
| seats, no AC, and manual windows. But they won't buy that
| one n
| pickle-wizard wrote:
| They are also thinking of that $10K in todays dollars.
| Adjusted for inflation, that $10K truck that could could
| buy back in the mid-80s costs the same as a new one
| today. You just get a heck of a lot more features.
| clintonb wrote:
| That statement makes no sense. The folks complaining can
| still buy those old pickups if they want. All that has
| happened is they are now older. No one is forcing them to
| buy a new truck that they use sporadically.
| quacked wrote:
| I've investigated about 20 of those old pickups; they're
| crap, because they've been run into the ground. I want a
| new old pickup.
| lotsofpulp wrote:
| That will not happen unless new legislation is passed:
|
| https://www.bloomberg.com/news/articles/2015-02-19/bigger
| -pi...
| yibg wrote:
| People can have nostalgia for stuff they grew up with but
| when it comes down to it don't actually want to spend the
| money to buy it now.
|
| I reminisce about 90s sports cars that I used to dream
| about too. But then I think about the lack of bluetooth,
| keyless start, the low power output, poor handling, poor
| safety, poor fuel economy, and I just buy a modern car
| instead.
| ricardobeat wrote:
| Assuming those memories are from the 70s, $10k then are
| worth about $50k today. Never mind the fact you're also
| buying a much, much better vehicle in most aspects.
| blfr wrote:
| Yeah, I don't like how overcomplicated many products are
| becoming but even then wouldn't buy a car without at least AC
| and Bluetooth.
| tristan957 wrote:
| You could easily pick up an after market bluetooth-enabled
| product. A/C is definitely important however.
| tim333 wrote:
| Though A/C doesn't really need much in the way of
| electronics.
| wiz21c wrote:
| interestingly, I go the opposite direction. I try to buy
| cars without AC (environmental reasons), without
| electronics (expensive to fix when they fail 'cos the
| constructor takes a huge premium on these), with the least
| possible automation ('cos I think these are overpriced)...
|
| Basically, the more sophisticated a car is, the higher the
| risk of failure and thus price to fix the failures. Now, I
| buy inexpensive cars. Maybe if I go for expensive brands,
| the risk is less.
| foobarian wrote:
| My must-have now is the backup camera with steering
| integration. I can hook up a trailer like a god now.
| SamuelAdams wrote:
| Actually new vehicles are legally required to have backup
| cameras. At least if they are sold in the US [1]. I would
| love to see a simple, back to the basics vehicle but
| there is so much regulation and safety requirements that
| it is unlikely for any basic vehicle to be sold in the
| US.
|
| [1]: https://abcnews.go.com/US/cars-us-now-required-
| backup-camera...
| SilverRed wrote:
| It's absolutely a good thing that these cameras are
| required with how many children are run over frequently
| as drivers reverse their cars.
| moffkalast wrote:
| "Where is your god now?"
|
| "Right behind you."
| panax wrote:
| I won't buy a car if it has bluetooth or cellular
| connectivity, but that is getting harder to find. I want
| that shit air-gapped. Someday I might have to just rip out
| the media head and telematics unit after buying it if I
| can't find one anymore.
| _moof wrote:
| I'd describe myself as having above-average privacy
| anxiety but I have to ask, what's the threat model here?
| I'm way more concerned about ALPRs than I am about
| Bluetooth or a data connection.
| kayone wrote:
| most things you mention are mandated by the government, you
| can't sell a car in any western market without tire pressure
| monitoring, stability control, back up camera etc.
|
| the manufacturers have no choice, it would be like suggesting
| they sell cars without seatbelts.
| mrweasel wrote:
| I hate tire pressure sensors, they are amazingly flaky and
| makes you uneasy about driving. That and the stupid alarms in
| my car that informs me that the temperature is below 4
| degrees, it disturbs my driving.
| megablast wrote:
| You should be uneasy about driving.
|
| For most people, it's the most dangerous thing you will do
| today. If you are going to kill someone, it's with your
| car.
| mrweasel wrote:
| But I don't need flaky sensors alert me of no existing
| problem. That just makes everything worse.
| chrisseaton wrote:
| False positives are annoying, but not knowing about a
| true positive is fatal.
| ladyattis wrote:
| I have a 2016 Hyundai Accent. Unless the law is very new my
| car has no backup camera or much else. I'm sure there's an
| emergency tire pressure sensor but that's about it. Not much
| to my car.
| icegreentea2 wrote:
| You're pretty much right before the cut-off. The rule/law
| in the US kicked in in mid-2018.
| ohmaigad wrote:
| Back up cameras are not mandatory until May 2022 in the EU.
| paganel wrote:
| We're already only a few months away from 2022, most (if
| not all) carmakers present on the EU market have included
| back-up cameras in their vehicles. I know that my brother's
| Dacia Logan built in 2019 already had one.
| Hamuko wrote:
| Backup cameras have been an optional extra for a long
| time sure, but I don't think I'm aware of any car that
| actually comes standard with one. Well, maybe a Mercedes-
| Benz S-Class. I do have a backup camera in my 10-year-old
| Benz, but I imagine that the original owner paid a four-
| digit amount of euros for it back in the day.
| jmccaf wrote:
| 'Rear Visibility' is required in new cars in US by FMVSS
| 111. Test procedure mandates field of view to rear of
| vehicles during backing, that are practical to satisfy
| with cameras. mirrors would require like a periscope to
| satisfy.
| Hamuko wrote:
| Yeah, but the US isn't the EU.
| [deleted]
| outside1234 wrote:
| Cars designed at least three years before they are shipped
| - so May 2022 might as well be tomorrow in car time.
| [deleted]
| bambax wrote:
| Ah. Not only does our car (VW from 2016) not have one, I
| don't think I have ever been in a car that had a backup
| camera.
|
| Reading in this thread that it's impossible to even buy a
| car without it is very surprising to me.
| estaseuropano wrote:
| That sounds like the Dacia and Tata approaches, although they
| sell addon packs as well.
| Hamuko wrote:
| Dacia's addon packages are pretty tame since you need to get
| an addon package for an FM radio or for height-adjustable
| seats.
| [deleted]
| bb123 wrote:
| I think Dacia addresses this market pretty well already.
| However many of the things you've listed (cameras, TPMS,
| telemetry) are mandated by law in most regions.
| carlmr wrote:
| Tire pressure sensors, ABS, ESP, airbags, etc. are compulsory
| in new cars in most countries.
| chrisseaton wrote:
| > tire pressure sensors ... luxury features
|
| These are to keep people alive! They aren't luxuries unless you
| think living is a luxury!
| liamwire wrote:
| I think you're vastly a) underestimating the time it takes to
| bring a new product line all the way into production in the
| auto industry, and b) overestimating the true demand for such a
| product, Hacker News and adjacent crowds notwithstanding -
| peoples broadly have come to expect those simple features at
| practically every price point, as evidenced by the ubiquity of
| said features in the market.
| throwawayjava wrote:
| B in particular. Products like the Yaris compete on price
| alone.
| Ekaros wrote:
| And Yaris is already premium affordable car. Koreans are
| slightly below it and then cheap ones are India or specific
| models.
| 00N8 wrote:
| I like your thinking & I wish this was a thing, but even if it
| were legal to sell new cars w/out ABS, traction control, backup
| cameras, etc., it seems like anyone who would actually follow
| thru w/ buying a car like that could just buy a used car - or
| buy a car w/ a salvage title & replace everything to their
| exact preferences - for way less than a new car costs anyway
| usmannk wrote:
| I can't imagine anyone would want the car you described, for
| market-sized values of "anyone"
| asdff wrote:
| Anyone driving a car thats older than 15 years old is already
| driving the car that OP is describing.
| oh_sigh wrote:
| Then OP can just buy a used car that has low mileage. Also,
| with many of the features they list, if they break, then
| they're just broken. It would have no effect on you if you
| aren't using those features already. A broken seat with a
| warmer is just a regular seat.
| LawnGnome wrote:
| Sure, but do they actually want that car, or is that just
| what they have and can afford?
| dropofwill wrote:
| I personally have no interest in any upgrades over my 20
| year old car. Maybe electric or no car at all if my
| living situation changed to support it. Obviously my hand
| will be forced soon enough as it slowly degrades.
| asdff wrote:
| I mean I drive that car because I don't see what I get
| out of a newer more costly model. I get my 35mpg and have
| my blutooth. Everything in the new car is exactly the
| same as everything in my old car.
| paxys wrote:
| And that car is worth $2000 on the market. No matter how
| many features they cut manufacturers aren't going to be
| able to sell a new car at that price.
| a1369209993 wrote:
| > And that car is worth $2000 on the market.
|
| Yes, because the only reason a person would be willing to
| part with one at anywhere near that price was if was a
| lemon.
| jacquesm wrote:
| Mine's from 1997 so easily in that range.
| golemiprague wrote:
| No, he is driving similar car with a lot of milage on it,
| especially these days with the crazy used car prices. If
| Toyota have made a basic mid 2000 corolla with no fancy
| anything I would pay for it much more than $2000, might
| install some aftermarket gadgets though but that would cost
| no more than extra $1000. The question is what would be the
| sweet price point for such a car and is it feasible to
| manufacture it for that price.
| eMSF wrote:
| Is a typical new car buyer currently driving a 15-year-old
| car?
|
| You could say that's plausible. In a way it even makes
| sense, that people buy cars and then drive them for as long
| as they reasonably last. But if you had to, would you guess
| that this is how the market operates?
| asdff wrote:
| No, because in every product sector people have shown
| when given a choice and the means to make it, they'd
| rather buy a shiny new thing than mend an older one. We
| are addicted to the dopamine hit of consumption.
|
| They aren't buying a new car on all these new widgets
| that might be different between one today and one from
| yesteryear. I bet for the vast majority of people the
| primary technological wants of a car are cold AC and
| blutooth. Everything else, your TPMS, your brake alert
| system that beeps like a missile is locked on when you
| inch too close in traffic, no one stood up and asked for
| any of that stuff. The market just saddled it upon us and
| the higher per unit cost is passed right along to us with
| markup.
| ihalip wrote:
| The latest Dacia Sandero is selling better than all other
| models in its class for a few months now - even if it's
| basically a revamped last-gen Renault Clio with even lower
| quality interior and safety features. Some people prefer a
| basic, cheaper car.
| colinmhayes wrote:
| Is that because it's literally impossible to buy other cars
| since they have a chip backlog though? Is it worth
| redesigning a car for a trend that will be gone next year?
| AdrianB1 wrote:
| No, it is because it is a lot cheaper and it can be
| bought by people that otherwise would not be able to buy
| a car at all. I know people who bought a Sandero for this
| reason and I was considering buying one one year ago,
| just before they announced an electric Dacia that I am
| still waiting for.
| lastofthemojito wrote:
| This feels like the Microsoft Word problem - Word users only
| use N% of Microsoft Word, the rest is needless bloat wasted
| on them. The problem is that the N% of features is different
| for each user.
|
| Some people like blind spot monitoring, others are annoyed by
| it. Some people need to have satellite radio, others never
| use it. Some people won't buy a car without Apple CarPlay,
| others would never so much as buy an Apple product. And so
| on... but for your product to appeal to customers in general,
| you need all of the features.
| lallysingh wrote:
| AFAIK, backup cams and TPMS are required. As for privacy, how
| do any of those features affect anything?
|
| But they're not changing their lineups, product design and
| marketing are expensive and take a long time. I don't think
| shrine expects the shortage to last that long.
| Hamuko wrote:
| > _AFAIK, backup cams and TPMS are required._
|
| Backup cameras are indeed mandated by law in the US for all
| new cars and have been since 2018.
| jordache wrote:
| You assert removing those "luxury" items results in a car that
| is immune to chip supply issues.
| pomian wrote:
| I like your idea. The only reason all those accessories are
| mandated, is because the car industry made it so, thus
| increasing the value (profit) of a standard car. We could just
| as easily 'mandate', a different class of vehicle. Call it a
| classic class, or something. For example, motorcycles don't
| have back up cameras, air bags, etc. Back to the consumer
| having a choice. Similar to right to repair.
| kayone wrote:
| > motorcycles don't have back up cameras, air bags, etc.
|
| why do you think that is?
| adolph wrote:
| Organ donation lobby no doubt.
| loeg wrote:
| Motorcycles don't have a reverse gear and airbags only help
| if you have seatbelts. Not sure what your point is.
| Motorcycles are radically more dangerous for riders than
| passenger cars are for drivers.
| Scene_Cast2 wrote:
| There are two practical issues with your suggestion.
|
| One is that neither one of us have any idea of the electronics
| BOM breakdown between the various parts of the car, and whether
| the effect of shortage would be mitigated in a meaningful way
| if the entertainment stuff was simplified. And you can't
| legally sell a new car in the US without back-up cameras and
| tire pressure monitoring.
|
| The second issue is that re-designing that part of the car
| takes more than a year (probably years, given that you need to
| collaborate with business and marketing to fit it in the
| existing lineup and e.g. not have it be associated with down-
| market products)
| octorian wrote:
| Especially since the chips experiencing horrible shortages
| are the cheap simple ones used for those dumb features no one
| even thinks about anymore.
| moooo99 wrote:
| I have a lot of thoughts about this comment, but here are my
| two cents.
|
| > There's a market for budget and privacy oriented customers
| that all carmakers seem to have ignored for two decades now.
| Give us a simple car with no GPS navigation, ass warmers, tire
| pressure sensors, telemetry, backup cameras, USB chargers,
| proximity detectors, traction control, keyless entry, remote
| climate control, etc.
|
| I feel like you're vastly overestimating the market size. Most
| non-tech people don't care about their privacy on their phone,
| their laptop or their TV. Most people don't even know that
| their car actually has the hardware to track them, why would
| they care about their privacy in their car?
|
| > I understand the re-engineering is a cost. But when you're
| simply removing existing features, this should be a fairly
| negligible one.
|
| I would not expect that to be fairly simple re-engineering.
| Many assistive technologies are mandatory in new vehicles (at
| least in some regions like the EU) such as automatic emergency
| calls, etc. Those are not standalone systems but they have many
| dependencies on sensors, etc. With the supply chains of
| traditional automakers, chances are the components necessary to
| integrate one mandatory system aren't even from the same
| supplier. This makes cherry picking features extremely hard if
| not impossible.
|
| > these carmakers have decided to throw up their hands and shut
| down production or pile up unfinished inventory waiting on
| chips. It makes precisely zero sense.
|
| I don't think it's coincidental that they decide to shut down a
| plant in Germany (besides the fact that Opel is originally
| German). In Germany we have something called "Kurzarbeitergeld"
| which is a support companies in trouble _can_ receive in
| certain situations to support their employees. Employees
| continue to work a fraction of the time (50% Kurzarbeit
| basically means you only work half of your weekly hours, 100%
| Kurarbeit means you don 't work at all for a certain period).
| The money the employees receive is largely paid for by the
| Government (the taxpayer).
|
| Usually Kurarbeit comes with a very strict set of rules, but
| thanks to covid those rules have been loosened a bit and
| especially carmakers (VW and BMW) take advantage of it (BMW for
| example sent many of their workers into Kurzarbeit but decided
| to pay billions of dividends to the Quandt family). So I
| suspect it was cheapest to shut down the Germany plant.
| throwawayjava wrote:
| By the time you finish the product design and manufacturing
| pipeline the chip shortage will be long over, and the market
| for a car without any modern amenities is not actually that
| big.
| Etheryte wrote:
| It might make zero sense as a buyer but as a manufacturer it
| makes a lot of sense. I would guesstimate that most of the
| margin is made on luxury and add-on features. A good example of
| this is rims: larger rims don't change anything for a daily
| driver, but you can add them as an option for a considerable
| premium. Same for many other add-ons and they're still bought
| very often. In addition to this, while there definitely is a
| certain subset of the market that would appreciate a product
| with considerably fewer features, my gut feeling is that it's
| the same in automobiles as in tech -- it's a very small part of
| the market.
| oh_sigh wrote:
| This is a surefire way to sell hundreds of cars. Yes, hundreds!
| cush wrote:
| Most of the tech results in absolutely critical safety
| features. Backup/blind spot cams, safer cruise control,
| breaking systems, etc etc. Nobody is begging for more dangerous
| cars.
| gklwand wrote:
| "Some 1,300 workers employed at the plant will be temporarily
| laid off, Opel said, with a separate plant in France picking up
| some of the production."
|
| Perhaps a very convenient chip shortage? Anyhow, why not build a
| car without electronics, gps, g4, microphones, voice control,
| tracking and screens. Because that is exactly what I want.
| xadhominemx wrote:
| > Perhaps a very convenient chip shortage?
|
| Absolutely not. Margins on new vehicles are the highest ever.
|
| > Anyhow, why not build a care without electronics... because
| that's exactly what I want
|
| You should just buy a low mileage used vehicle
| seszett wrote:
| > why not build a car without electronics, gps, g4,
| microphones, voice control, tracking and screens. Because that
| is exactly what I want.
|
| That sounds like what Dacia does.
| intricatedetail wrote:
| There are already bills in the pipeline to require all cars to
| have GPS in the EU (speed limiters) and more privacy violating
| stuff. Governments want to know of every aspect of your life,
| so any privacy conscious device will not be viable.
| wonderwonder wrote:
| Very few people would want this, certainly not enough to
| warrant a production line. The cars you want already exist,
| just buy a classic car from the 60's. None of the stuff you
| dislike and if done right a nice looking car. Gas is a bit more
| though.
| ashtonkem wrote:
| Because even that car would have chips in it, unless if you're
| selling it illegally. You cannot make a gasoline engine that
| meets emissions regulations without sophisticated engine
| control unit (ECU) systems in it. That and there are a bunch of
| safety features that require it, like ABS and automatic
| braking. In the United States it is also illegal to sell a new
| car without a backup camera, which obviously requires a screen
| of some sorts near the driver.
|
| Beyond that, the reality is that these features you decry are
| very, very popular. Nobody will make a car exactly the way you
| want, because that's not where consumers are.
| kbaker wrote:
| One important part of the chip shortage is the massive amount of
| price gouging going on.
|
| Every IC is being bought up by new 3rd party distributors to
| scalp to desperate electronics manufacturers.
|
| Take a look at this chip we are just now crossing as an example,
| click on 'Non-authorized stocking distributors':
|
| https://octopart.com/tps2052bdgnr-texas+instruments-699312?r...
|
| Win Source has a bunch, but you will pay 6x the cost. We have
| been quoted even 100x the list price for some ICs on our boards.
|
| Luckily as a small company we are nimble and can mostly cross to
| similar components, and have been for months now, but a whole
| board assembly run can be stopped with a single component being
| impossible to find out of hundreds on the BOM.
|
| Having scalpers in the mix raising the price for all components
| worries me that the chip shortage might not end for many years,
| as they can self-fund by raising their prices to stock up on new
| supply. Not to mention the higher number of random failures as
| counterfeits easily find their way into the supply chain without
| 'authorized' distributors.
| coryrc wrote:
| What's the difference between scalpers and Digikey
| hypothetically raising their prices sixfold?
| leppr wrote:
| It's better that the producer gets the correct price for
| their items. That way they can invest in their infrastructure
| or bid up source materials, getting closer to being able to
| meet demand. On the other hand profits going to the scalpers
| doesn't contribute towards fixing the problem.
| fortran77 wrote:
| Digikey isn't a producer.
| TedDoesntTalk wrote:
| Why do the scalpers get first dibs on the supply?
| beebeepka wrote:
| That's the right question. As Huang said a few years ago: the
| more you buy, the more you save
| TedDoesntTalk wrote:
| In concert ticket sales, scalpers get preferential
| treatment because:
|
| 1. nepotism: they know someone who works at or owns part of
| the venue, or the performer, or the performer's manager,
| etc
|
| 2. they reliably buy in bulk
|
| 3. corruption: they pay off someone on the inside.
|
| so which is it here?
| jandrese wrote:
| 4. The scalpers are the same company that sells the
| tickets.
| taffer wrote:
| > As Huang said a few years ago: the more you buy, the more
| you save
|
| This is what wholesalers do: they buy large quantities at
| low prices and then sell small quantities at high prices.
| nosianu wrote:
| Wholesalers' key contribution is distribution though.
| They have actual infrastructure and do real work that is
| actually useful. They also do this continuously,
| providing a stable service, and not just sometimes to get
| in on some market swings.
| rabbitsbynight wrote:
| I really enjoyed this comment and the thread it started. I
| wrote some thoughts as a little blog post, and would welcome
| any thoughts or contrary opinions (I'm no expert, just thinking
| out loud).
|
| https://rabbitsbynight.notion.site/Scalping-vs-price-gouging...
| jdasdf wrote:
| > One important part of the chip shortage is the massive amount
| of price gouging going on.
|
| There is no such thing as "price gouging".
|
| It just so happens that at this moment the price of things is
| higher than it usually is due to increased demand and reduced
| supply.
| nicoburns wrote:
| Increased demand doesn't increase prices on its own. The
| seller also has to Choose to sell at the higher price.
| zamadatix wrote:
| Price gouging is a real thing and "the price of things is
| higher than it usually is due to increased demand and reduced
| supply" is actually part of it's definition. I.e. price
| gouging isn't a replacement for the supply/demand model
| rather a description in certain extreme cases of said model,
| often regulated cases depending on the jurisdiction.
|
| Traditionally it referred to traditional survival items
| though, not just any item.
| bsder wrote:
| > Having scalpers in the mix raising the price for all
| components worries me that the chip shortage might not end for
| many years, as they can self-fund by raising their prices to
| stock up on new supply.
|
| Tough. Then run a fab or start carrying inventory.
|
| Just-in-time and fabless had risks that everybody simply
| ignored over and over. I'm happy to see companies taking it in
| the shorts for that.
|
| Everybody loves the "free market" when it works in their favor
| and whines when the same winds turn around and bite them in the
| ass, personally.
| Cthulhu_ wrote:
| Scalpers - and others willing to pay a premium from the
| supplier - will in all likelihood (IANAEconomist etc) cause a
| whiplash / bullwhip effect; scalpers create high demand,
| manufacturers increase production and continue to do so until
| the market is saturated, then suddenly the scalpers have huge
| stocks of e.g. chips and can no longer sell them at a premium,
| making them drop prices to match the manufacturer's.
| taffer wrote:
| > Having scalpers in the mix raising the price for all
| components worries me that the chip shortage might not end for
| many years, as they can self-fund by raising their prices to
| stock up on new supply.
|
| How do the scalpers get the supply before someone else gets it?
| What do the scalpers do when IC manufacturers increase supply
| and electronics manufacturers decrease demand by switching to
| similar components? What if one of the scalpers panics, dumps
| its inventory, and causes a price drop?
|
| The whole situation could just as quickly turn into the
| opposite when production returns to normal.
| hamilyon2 wrote:
| There is no better wat to encourage additional
| production/reuse/alternatives. Shortage just tells binary
| signal, prices lets you actually esimate how much this and that
| will cost.
| hutrdvnj wrote:
| Scalpers are not the problem as they seem, they are like market
| makers for stock exchanges. They buy low and sell high, always.
| The factory could tell you that they're currently out of stock
| for the next few months, but a scalper will never be out of
| stock, because their prices rises so high that only very few
| desperate companies would buy. The point is, it's better to
| have the option to buy something at a high price, than to have
| no option to buy at all.
| polskibus wrote:
| They are similar to a market maker but it's not the same.
| They are like predatory HFT, benefiting from fast information
| propagation. Most of the time the market would function well
| without them, with much less volatility in the price. In that
| sense, scalpers en masse are destabilizing the economy.
| TeMPOraL wrote:
| The way I see it, this makes sense in a hypothetical world of
| perfect theoretical models (you may recognize this world as
| being the one inhabited by frictionless, perfectly spherical
| cows). In this world, scalpers cause the market to price in
| "stickiness" - the more critical an item is to the buyer, the
| more they'll be willing to pay - so the supply ultimately
| gets allocated to the most desperate of buyers, for the price
| of "your entire margin", or possibly "literally all you
| have", if the buyer's survival depends on it.
|
| Maybe this makes sense in that theoretical world - where
| there's no inertia, no friction, no capital investment, no
| jobs and livelihoods tied to the outcome. But in reality,
| scalping seems to be the purest form of parasitism. In a
| crisis, scalpers' activities may kill perfectly fine
| companies (or people) who would've otherwise limped through
| the rough times and survived, upsetting an industry long-
| term, and it forces everyone to waste their money.
|
| And even if you think that this kind of market culling is
| fine, I'm not seeing why all that money should go to the
| first asshole who managed to secure a large loan in time to
| buy off the entire stock of some good.
| drdeca wrote:
| It seems to me like most of the (alleged) benefits of
| scalpers would be equally well achieved by selling (some
| fraction of) the items in auctions, instead of just picking
| a price.
|
| However, my impression is that consumers would view this in
| a negative light, and that the harms to the seller's
| reputation would be enough to outweigh the initially
| increased income. This seems to be the source of the
| inefficiencies that scalpers exploit/address.
|
| This leads me to an idea which, I don't believe is
| typically done, but which I don't know why not: Why
| wouldn't a company just, list a price that they are "going
| to sell it at", and then "sell" a large proportion of them
| at that price to an entity which isn't publicly connected
| to the company, and then that organization sells the items
| via auction (and returns a large proportion of the profits
| back to the company).
|
| While on the one hand, I don't see how I'd be able to tell
| if this was what was done, and therefore don't see how to
| confirm that this isn't what is being done in the cases
| where there are scalpers, I don't think this is being done,
| and don't know why.
| lmm wrote:
| > This leads me to an idea which, I don't believe is
| typically done, but which I don't know why not: Why
| wouldn't a company just, list a price that they are
| "going to sell it at", and then "sell" a large proportion
| of them at that price to an entity which isn't publicly
| connected to the company, and then that organization
| sells the items via auction (and returns a large
| proportion of the profits back to the company).
|
| That's often how a lot of today's "scalping" is done -
| AIUI a lot of "secondary market" tickets on StubHub etc.
| are sold by an entity that's owned by TicketHub or
| whoever, so that the artists can sell their tickets at
| the price the market will bear but put a low face price
| on them for the sake of their reputation.
| matkoniecz wrote:
| Maybe producer can sell some part on auction and donate
| extra income to some charity?
|
| At least this way parasitic scalpers would not benefit.
|
| (this assumes that charity would be some actual charity,
| not just existing to transfer money to family of CEO or
| something similar)
| [deleted]
| birdyrooster wrote:
| I and many other gamers have a negative view of Nvidia
| because of their inability to thwart scalpers and crypto
| miners. To quote a wise man, "so Nvidia, fuck you!"
| jrockway wrote:
| It's not really NVidia's fault. The problem is that you
| can buy a GPU for $1000 and use it to print $2000 of
| money. That's annoying because most people just want to
| play a computer game, not print $2000 worth of money.
|
| The other thing NVidia could do is keep all their GPUs
| for themselves and mine crypto.
| ekianjo wrote:
| > The other thing NVidia could do is keep all their GPUs
| for themselves and mine crypto.
|
| Who says they are not already doing that in some
| capacity?
| avianlyric wrote:
| That sounds like a lot of work, and a PR nightmare if the
| public ever found out.
|
| Nvidia is already a money printing machine, and their
| margins are growing. I doubt it's worth the time
| investment and risk exposure to the crypto markets for
| Nvidia. Better off using that time a money inventing
| better money printers.
| hef19898 wrote:
| Why would you start digging for gold if you are already
| becoming rich producing and selling the shovels?
| jrockway wrote:
| I guess it's easier to make a shovel than it is to make a
| GPU, and it's easier to do industrial-scale crypto mining
| for a company that already owns a datacenter than it is
| to build an industrial earth processing operation. If
| NVidia wanted to mine a lot of coins, they no doubt have
| a few employees that could get that started. But it
| doesn't seem like they want to, perhaps because it's not
| a sustainable business or perhaps because their customers
| are already mad at them and they don't want to make it
| worse. (Though it's not really their fault that customers
| are mad at them; they're actually mad that someone
| invented cryptocurrency, which is not NVidia's fault.)
| drdeca wrote:
| Ok, but like, would their overall reputation be higher if
| they were to directly put some proportion of their
| inventory up for auction (like, each item individually,
| not like one auction for a bundle of a very large number
| of GPUs) instead?
| jhanschoo wrote:
| No, the prices will still be comparable to scalper
| prices, and the cost-conscious consumer market will
| remember the company's price gouging when they make their
| next-generation purchase
| drdeca wrote:
| This response was initially confusing to me, but thinking
| about it, I think it led me to realize that complaints
| about things like this are, essentially, an attempt at
| coordination among consumers, in order to collectively
| get a better deal.
|
| If there were only a single consumer, a monopsony, they
| would have a large degree of influence on the price.
|
| Building a public consensus on what prices are reasonable
| and what prices are "too high" allows for exerting
| similar pressures on the price, as if there were an
| organization which represented a large portion of the
| consumers and which would make a single decision for all
| of that portion (like, a purchasing union thing).
|
| I hadn't realized this.
| birdyrooster wrote:
| No, but at least they are being enriched to invest in
| research and development instead of some arbitraging
| trolls that will spend it on hookers and blow.
| keyringlight wrote:
| There was a minor controversy nearly a year ago where a
| MSI subsidiary that was only supposed to get old/refurb
| stock managed to get new stock of the nvidia 30 series
| and then proceeded to sell them with inflated pricing.
| Being charitable I'd say it's likely someone over-
| enthusiastic at that subsidiary and it blew up in their
| face, but it doesn't help with them being perceived as
| fair
| xyzzyz wrote:
| This is exactly how concert ticket scalpers work.
| Bands/producers covertly but with full awareness sell
| most of the ticket to scalpers, which outsources the
| reputation hit.
| Lev1a wrote:
| My mother told me about some new anti-scalper scheme she
| encountered recently when she was looking at ordering
| concert tickets for herself and my father. It went
| something like this:
|
| - basket size limited to IIRC a maximum of five tickets
| for the same concert,
|
| - name of the buyer is linked to (idk, maybe even printed
| on) the tickets AND
|
| - the named buyer would have to be there with the group
| to enter the venue.
|
| I think this would probably be pretty effective in
| countering that bottom-feeding scum called scalper.
| xyzzyz wrote:
| You don't seem to have caught my point: it is the bands
| themselves that work with the scalpers. They sell a chunk
| (often majority) of tickets directly to the scalpers for
| a price above what they publicly claim to charge. Then,
| they introduce measures like you describe, to reduce
| competition from grassroots scalpers, to ensure stable
| business situation for the anointed scalpers.
|
| This arrangement works great: the reputation hit is very
| successfully outsourced to what you call "bottom feeding
| scum". The band benefits from higher profit than they
| would otherwise be able to get if they tried to sell all
| their tickets at the publicly advertised price, which
| quite apparently is below the market clearing price.
| Ticket availability is increased: instead of having to
| fight to book the tickets in 8 seconds after the
| registration is opened, everyone can buy tickets at their
| leisure, simply paying more for convenience when they buy
| from scalpers.
|
| Let me ask you this: for the band you are talking about,
| despite all the measures you describe, you still could
| buy tickets on StubHub, no?
| dahart wrote:
| This actually is the idea with truly "free market"
| thinking, no? The money wasted in a crisis, and the
| companies killed who would've otherwise limped through, is
| all assumed to be less waste and a better outcome than the
| alternative we get if we prevent scalpers and/or cap the
| prices. In this theoretical world, we waste more money when
| supply runs out too fast, and we get companies that are not
| as good at competing because they limped through.
|
| The big question economically is whether these assumptions
| are generally correct. We have evidence in both directions,
| enough that most people can comfortably stick to their
| opinions and learned assumptions and political tribes. But
| is there a way to demonstrate that the money wasted is
| greater with hoarding/scalping than without, and under what
| conditions?
| awakeasleep wrote:
| Actually the original 'free' in free markets meant free
| from economic rents
| dahart wrote:
| Sure, but that's not what it means anymore, right?
| Today's "free" means no regulation.
| [deleted]
| awakeasleep wrote:
| Yeah now it means "free to capture economic rent" almost
| the exact opposite.
| ben_w wrote:
| Ah, that makes a lot more sense than the generalised
| freedom I'd assumed.
|
| I really should read Wealth of Nations...
| yholio wrote:
| Scalpers perform a social service by rationing demand and
| ensuring availability. They don't eat the whole consumer
| surplus, rather, they must compete amongst themselves and
| the price you pay is the amount that makes client N+1 walk
| away if total supply is N. Some of the buyers will find
| that close to their margin, but others, for which the
| product is essential in very valuable (thus socially
| useful) goods or services, will thank God they have found
| the supply.
|
| Think about hospitals paying 10 times more for antiseptic
| and performing surgeries, instead of someone drenching
| their driveway with that 10$ antiseptic while someone else
| dies without a needed surgery. By raising the price and
| pocketing $90, the scalper has prevented resource waste and
| supplied to the patient and hospital a service worth
| hundreds of thousands.
|
| If a scalper becomes a monopoly, they can extract a
| monopoly rent and really bleed everyone dry - but so can a
| producer in the same situation, so the problem is low
| competition not intermediaries.
| orhmeh09 wrote:
| When did people start dousing their driveways in
| antiseptic?
| SXX wrote:
| People do all kind of weird shit especially under stress
| during pandemic. Tons of richer people who are not
| scalpers bought ventilators for instance. And this is
| very expensive medical equipment which is completely
| useless without team of specialists to operate.
|
| So people bought ventilators completely useless for them
| make supply shortages on them much worse. And unlike
| scalpers these people who do something like that due to
| panic are unlikely to sell them back to market when
| they're most needed.
| dapids wrote:
| > "Scalpers perform a social service"
|
| Good luck finding anyone willing to recognize this absurd
| point.
|
| > "the problem is low competition"
|
| Tell that to the GPU market.
| King-Aaron wrote:
| I've noticed a new wave of neo-capitalists who seem to be
| actively sympathising with (if not encouraging) scalping.
| "It's just the way the free market works!" "That's how
| retailers always worked!" "It levels out demand!".
|
| Such grubby people.
|
| In basically all my hobbies, scalping has become the norm
| now. Computers, Japanese cars, tabletop games, hell even
| kids toys. It does feel like there's been a massive
| increase in the number of people with enough capital to
| see a trend and basically buy the market out with the
| intention of making a profit.
| bluecalm wrote:
| So what's your solution? If there is limited number of
| 3090 GPUs should they be allocated to those who order
| them first? By random? Auction?
|
| Scalpers at least ensure you can get it of you really
| need it (that is willing to pay a lot).
| King-Aaron wrote:
| I don't have a solution nor do I think I need to offer
| one, I just think that people who engage in (and
| sympathise with) scalping are grubby people.
| chii wrote:
| It's not illegal to be an asshole. At least scalpers
| reveal the true cost of the product.
| enaaem wrote:
| Let's say resources are allocated first come first
| served. What if I could pay someone to camp in front of
| the store and wait in line for me?
| wyager wrote:
| > Good luck finding anyone willing to recognize this
|
| Indeed, most people are pathologically incapable of
| performing utilitarian reasoning and have a very hard
| time with this point. Very unfortunate, because that's
| what informs most economic policy.
| exporectomy wrote:
| You disagree but with no reasons. You should consider why
| you hold that belief.
| [deleted]
| [deleted]
| Lord_Baltimore wrote:
| I recognize this "absurd" point.
| Red_Leaves_Flyy wrote:
| In a civilized society it is the governments burden and
| obligation to ensure scarce resources are shared
| responsibly. When this process is disrupted and not
| quickly remedied you will inevitably discover that people
| take matters into their hands to get what they need. They
| might commit white collar crimes or engage in destructive
| or violent robberies and protests. They might also roll
| out the guillotines and collect some scalps to remind
| society at large that the most dangerous people are those
| who've had everything robbed of them. When entire regions
| and communities are allowed to reach this point war is
| almost inevitable.
| spectramax wrote:
| Absolutely not. "Sharing resources" doesn't work when
| there is not enough to share.
|
| A civilized society works when supply and demand
| intersection determines the price of goods and services.
|
| Governments should interfere for specific cases (life
| emergency, masks, etc) and there are laws prohibiting
| scalping for these commodities - rightfully so.
|
| Your idea of government intervention would assume that
| government is a rational entity. The truth couldn't be
| further from it. Bribes and political favors from large
| companies would leave everything worse than it was
| before.
|
| Imagine you're a low volume medical instrument maker and
| you need a dozen STM32 chips for your life saving device.
| Scalpers make sure that these chips are available and
| ready to ship, albeit at a premium which the company is
| happy to pay for given the circumstances.
| pitaj wrote:
| Laws prohibiting "scalping" or "price gouging" in
| emergencies often makes problems worse by incentivizing
| hoarding and disincentivizing more suppliers from
| entering the market.
| tbihl wrote:
| Price gouging laws target the products with most serious
| risk of shortages and guarantee shortages. I think back
| to the gas pipeline shutdown earlier this year, and how
| simply that could have been a non-issue if stations had
| been allowed to raise prices.
| chii wrote:
| The problem is one of optics - if life-essentials were
| allowed to be price-gouged, the local gov't officials get
| blamed for not instituting price control during the
| period of shortage. Even if the shortage would've been
| worse had there been price control!
| treeman79 wrote:
| The government is often the cause of scarcity.
|
| If price sky rocket, investors will increases production
| until prices are lower.
|
| Government can mess with this by limit prices causing
| investors to stay away, meaning fewer chips get built,
| thus ensuing a temporary problem gets worse.
| NicoJuicy wrote:
| You can't increase production of semiconductors within
| 3-4 years.
|
| Those assembly lines are highly specialized and extremely
| efficient. After all this time, the best they can do is
| 1% extra efficiency per month.
| treeman79 wrote:
| And factories were big and owned by the evil rich, so
| Russia socialized them. Thus leading to decades long
| shortages for all but the very rich.
|
| A short term (1-5) year problem is no reason to takes
| steps to ensure a generational problem.
|
| Free market is brutal about improving efficiency and
| growing with demand.
| iseanstevens wrote:
| I think that everyone I've met with this viewpoint has
| been an "intermediary" or one who profits from them.
|
| Your thoughts on that?
| roenxi wrote:
| You're probably doing a bad job of inviting people to
| share their actual opinions with you. The easy &
| practical choices here are:
|
| 1) People with more money to spend get first pick of
| stuff.
|
| 2) Lottery / people who get to the store-front first.
|
| Both of those are legitimate, although #1 does have a lot
| of support and theoretical backing in practice. Most of
| the third ways that get tried devolve back into one of
| those 2.
| dragonelite wrote:
| Your describing a capitalist dystopia where people with
| capital can buy up commodities on the cheap and then
| resell it for 200~900% markup. No thanks I rather not
| want to life in such a dystopia.
| nicoburns wrote:
| Governments can do this without the inefficiency of the
| scalpers profits in cases where the need is great.
| yholio wrote:
| Also known as a command economy, a staple stalinist
| recipe.
| runesoerensen wrote:
| _> Also known as a command economy, a staple stalinist
| recipe_
|
| No. That's an extreme, just like your idea of what you
| call a "social service" performed by scalpers.
|
| There's a middle ground, and it's certainly possible to
| regulate a market to mitigate the most pathological
| consequences of capitalism without Stalinism. In fact,
| that happens all the time.
| rjzzleep wrote:
| Such an idiotic statement. When every other country was
| suffering under scalpers buying up mask supplies at the
| beginning of the pandemic Taiwan, South Korea and some
| other countries actively took a hand in mask
| distribution. The result:
|
| - cheaper access to masks for the general population
|
| - no mask shortages in critical infrastructure such as
| hospitals or other health care institutions
|
| - general better handling and health outcomes during the
| pandemic
|
| Leave it to the Americans that would consider sound
| policy and good health outcomes stalinist or communist
| recipes.
| blowski wrote:
| Exactly there's a "guilty by association" fallacy here.
|
| 1. You want the government to control production of some
| resources.
|
| 2. Stalin controlled production of some resources
|
| 3. Stalin killed millions of people
|
| 4. Therefore, you want to kill millions of people
| ckuehne wrote:
| No, there is only "knowing that communist central
| planning always ends up in shortages".
|
| See here https://news.ycombinator.com/item?id=19970544
| for an example that illustrates the point nicely.
| blowski wrote:
| "Some central planning" does not mean "communism".
| rjzzleep wrote:
| On top of that the US and Germany had the same ability,
| it just that they were extremely slow in their decision
| making.
|
| When they finally made that step it did help.
| Incompetence caused scalpers to rise and profit while the
| rest suffered until the Government finally got their
| heads out of their asses.
|
| Nothing about stalinism or communism in here. Just
| general incompetence.
| raducu wrote:
| > Scalpers perform a social service by rationing demand
| and ensuring availability.
|
| While the fundamental issue is indeed price discovery,
| even in the most abstract market -- stocks/fx/derivatives
| there are numerous regulations in place to limit the
| predatory behavior of certain speculators.
|
| It is astonishing we have no such regulation for real-
| life items.
|
| Scalpers are compounding a problem, by reselling
| something at 5X the price they invite others to do the
| same, they create artificial demand and speculation.
|
| > Think about hospitals paying 10 times more
|
| No, think somali pirates in terms of transportation
| costs. If you only look at it throught the autistic-
| economical lens, they are entrepreneurs helping the
| market find the right price for transportation.
|
| > the problem is low competition not intermediaries
|
| The problem is inelastic markets and high moats. Think
| New York real estate market where mobsters around the
| world inflate property price and will destroy the local
| economy.
|
| Think about drug cartels and drug prices.
|
| Think about the USD and its status as a global currency
| and its relationship to the Military Industrial Complex.
| christophilus wrote:
| > It is astonishing we have no such regulation for real-
| life items.
|
| We have something close for emergency situations. It's
| illegal to price gouge during something like the
| aftermath of a hurricane.
|
| It's a well intentioned law. But for some things, it
| really may be best to let market forces dictate. For
| example, generators are in high demand and short supply
| during a hurricane. Folks snap them up so they can play
| Nintendo. Because they're inexpensive due to gouging
| laws, they sell out fast. Now, someone who actually needs
| that generator for important, possibly life-saving work
| is SOL. And there isn't a price incentive to expedite
| bringing in more supply.
|
| Edit: I still think the scalpers are scumbags. Just
| wanted to point out an argument I found compelling in the
| past.
| WanderPanda wrote:
| You don't need to apologise! It is sad that people don't
| get this simple mechanism. I believe that lots of misery
| could have been averted if market signals where not
| distorted when they are needed most. E.g. in your example
| higher prices for generatora would not only prevent
| people from buying them for less important things but
| also open up a location arbitrage opportunity and
| incentivise to bring generators to the place where they
| are needed most.
| [deleted]
| gnopgnip wrote:
| In reality the market isn't a zero sum game. And there
| isn't a fixed supply of resources. In a crisis scalpers
| ensure that the customers receive critical goods that may
| otherwise be unavailable at any price. Not having that
| option could kill a company just as well. All of the profit
| money doesn't go to the scalper either, the original
| manufacturer can sell for higher prices, reallocate
| resources to make what is most profitable and meet the
| demands of the market. And there are price gouging laws to
| limit this activity for essential goods in an emergency.
| raducu wrote:
| > And even if you think that this kind of market culling is
| fine, I'm not seeing why all that money should go to the
| first asshole who managed to secure a large loan in time to
| buy off the entire stock of some good.
|
| Very well said, but I'd go even further -- scalpers know
| other scalpers will do the same and create artificial
| shortage so they are actually preying on legitimate
| customers, so there's an adversarial component to the
| behavior of scalpers as well.
|
| We rationed toilet paper during the lockdowns and there was
| a legitimate reason people were hoarding it, but we do
| nothing about scalpers who have no legitimate reason for
| their behavior.
| WanderPanda wrote:
| If it is about "being the first" then obviously the pricing
| by the manufacturer is inefficient. In the end the scalpers
| you describe just fill in the void that is opened up by the
| manufacturers not adjusting their prices to the demand.
| Consultant32452 wrote:
| "No offense, but it sounds like some commie gobbledygook to
| me." ~Norm Macdonald
| amelius wrote:
| > Scalpers are not the problem as they seem, they are like
| market makers for stock exchanges. They buy low and sell
| high, always.
|
| How do you feel about scalpers who do not act in scarcity but
| instead create the scarcity themselves. Like those who buy up
| land in popular cities?
| op00to wrote:
| You ignore that a scalper can easily slip counterfeits into
| the mix. An authorized reseller would be ruined if they did
| that.
| Retric wrote:
| They can only do that by holding onto to supply which makes
| shortages worse. The same thing happens with ticket scalping
| at concerts, the difference is it's more obvious that a sold
| out concert has empty seats vs supply sitting in a warehouse
| on the off chance it can be sold at 100x prices.
| abfan1127 wrote:
| this is false. the supply would be gone at those low
| prices. Now they can be had for those who want it badly
| enough.
| basilgohar wrote:
| Your statement is false. Demand would be met with an
| increase in supply, satisfying all needs for the product
| and without the "help" of scalpers who sidestep supply-
| and-demand by artificially creating scarcity to drive up
| demand for their own profit. This is no help to anyone
| but themselves.
|
| If there's a legitimate demand that will be used, then
| there's a good case for production to be increased to
| meet such demand, and all parties who need something
| would have their needs met.
|
| At no point to scalpers make this system more efficient -
| they just serve to extract a greater profit from
| consumers and businesses for their own benefit by the
| aforementioned artificial scarcity that they make. This
| is also known as cornering the market, a well-known and
| despised practice that has been frequently used by
| morally corrupt individuals who sought only to benefit
| themselves. Nowhere can nor should the argument be made
| that scalpers help anyone but themselves.
| bricemo wrote:
| Except increase in supply in chips takes 3-5 years
| lmm wrote:
| > Demand would be met with an increase in supply,
| satisfying all needs for the product and without the
| "help" of scalpers who sidestep supply-and-demand by
| artificially creating scarcity to drive up demand for
| their own profit. This is no help to anyone but
| themselves.
|
| There's no "artificial" demand. Think about it - the
| "scalper" isn't going to buy something that they can't
| sell on, they'd just lose money that way. (Maybe some of
| them make bad judgements - but they'll naturally go out
| of business in that case).
|
| > If there's a legitimate demand that will be used, then
| there's a good case for production to be increased to
| meet such demand, and all parties who need something
| would have their needs met.
|
| "Scalpers" improve the quality of that signal and make it
| easier to increase production with confidence.
|
| > This is also known as cornering the market, a well-
| known and despised practice
|
| Views on true corners are certainly mixed (there's an
| argument that it punishes dishonest market makers), but
| in any case it only applies to buying up the whole
| supply, which no individual "scalper" does or can.
| nitrogen wrote:
| _Think about it - the "scalper" isn't going to buy
| something that they can't sell on, they'd just lose money
| that way._
|
| The only reason they can sell something on is because
| they created an artificial scarcity of the thing. If
| widget X has a well-matched supply and demand, and a
| scalper decides to buy 10% of widget X, then 10% of the
| demand is now unmet, some of the buyers go out of
| business, and the maker of widget X now has 90 something
| % of their previous market.
| lmm wrote:
| > The only reason they can sell something on is because
| they created an artificial scarcity of the thing. If
| widget X has a well-matched supply and demand, and a
| scalper decides to buy 10% of widget X, then 10% of the
| demand is now unmet, some of the buyers go out of
| business, and the maker of widget X now has 90 something
| % of their previous market.
|
| If that happens, then the price drops, and the "scalper"
| loses money - demand has some elasticity, and a healthy
| market has some slack in it. Momentum-trading speculation
| works sometimes, but anyone who uses it as their sole
| strategy will go bankrupt sooner or later.
| Retric wrote:
| > The scalper isn't going to buy something they can't
| sell on
|
| That assumes they have perfect information which they
| don't they can only estimate demand. It's perfectly
| rational for a scalper to regularly purchase more tickets
| than they sell due to the kind of markup their looking
| for. At say 4x they could on average sell 1/2 the tickets
| while doubling their investment.
|
| And of course that assumes they never run into logistical
| issues.
| lmm wrote:
| > It's perfectly rational for a scalper to regularly
| purchase more tickets than they sell due to the kind of
| markup their looking for. At say 4x they could on average
| sell 1/2 the tickets while doubling their investment.
|
| True, but in that case they've added more value than
| they've subtracted. That artists insist on pricing every
| concert to sell out is a big part of the problem here;
| you'd get a more functional market by accepting a few
| empty seats to give some slack.
| Retric wrote:
| Bands want to present the appearance of a successful
| band, it helps their image. A filled stadium is part of
| that, so yes they can make more money today by raising
| prices but that's making real trade offs.
| Lord_Baltimore wrote:
| 1. No one assumes that they have perfect information. No
| one says this is perfect just better than the other ways
| to handle these situations!
|
| 2. Who do you think will consistently have better
| information than someone whose sole goal is to sell these
| tickets?
|
| 3. If they are consistently losing money scalping and not
| selling tickets they won't be a scalper much longer.
|
| 4. This is a dynamic process which can account for
| changing variables regarding supply and demand quickly as
| opposed to rules and regulations which do not.
|
| 5. If they only sell half the tickets at 4x then they
| could sell the last half at an extreme discount and make
| even more than double their investment! Do you think they
| would rather make more money or less?
| throwawaythekey wrote:
| For 5. consider the diamond industry as a real world
| example of an industry well renowned for aggressively
| limiting supply.
|
| Scarcity can drive price upwards in an exponential way
| that ends up making it optimal to not sell all inventory.
| Sure in an ideal world you would sell everything you can
| for the maximum price but in the real world the buyer is
| incentivized to wait until you offer your minimal price.
| adamc wrote:
| "This is false" isn't much of an argument. If there is an
| argument, you should probably provide that instead...
| skybrian wrote:
| Empty seats mean someone screwed up but how can you tell
| that a group of empty seats is unused due to a scalper,
| versus some group of people who couldn't make it?
|
| When speculators don't screw up, one fewer part being sold
| now means one more part that can be bought later. Delaying
| sales of some parts makes the shortage worse earlier and
| better later. Keeping inventory is a service to people who
| didn't plan ahead.
|
| Sometimes people do screw up, buying things that are never
| used, so they lose money due to the waste. But you can't
| assume they're all screwups.
| Retric wrote:
| Your right concerts make it hard to tell why seats are
| empty however unsold inventory is part of the basic
| business model of reserving a section of supply at higher
| prices not simply a mistake.
|
| Airline seats are a better comparison. Airlines keep
| raising prices as inventory gets sold and flights near.
| However, that approach means they generally fly with
| significant unused excess capacity. The reverse approach
| where prices got cheaper as the flight neared would
| result in increased occupancy though significantly less
| total revenue.
|
| The discrepancy shows up because buyers may be willing to
| pay radically different prices. A business traveler may
| be willing to book a last minute seat at 3x the price a
| holiday traveler who's booking 6 months in advance.
| Hypothetically, making a 50/50 bet on a 3x sale is
| clearly a good idea but it means 50% of the time that
| seat sits unused.
| roenxi wrote:
| That needs to be sourced from somewhere; the classic
| understanding of airlines is they usually overbook [0]
| and rely on people not turning up.
|
| In fact, the whole "lets not sell our inventory, we'll
| make higher profits!" idea here is suspect. The idea that
| having unsold inventory in the model is a good idea is
| just false; having inventory left over is always
| undesirable. If it was sold at the last minute then they
| would have more profits. The scalpers are incentivised to
| minimise leftover inventory to the point where it isn't
| going to be a big deal.
|
| [0] https://www.travelperk.com/blog/overbooking-airlines-
| quick-g...
| Retric wrote:
| It isn't a question of what happens on specific flights,
| it's a question of what happens generally. Global load
| factors are ~85% which is a long way from constantly
| overbooked.
|
| Pre pandemic to get a normal picture:
| https://www.airlineratings.com/news/packed-planes-new-
| normal...
|
| Low cost US carriers have a load factor of 90% that's a
| trade off between fixed aircraft size and variable
| demand. However, US carriers only average a load factor
| of 86.5% meaning legacy carriers like American Airlines
| have a below 86.5% capacity factor and that difference
| between 90% and ~85% is exactly the optimization I am
| talking about.
| roenxi wrote:
| I'm guessing that is a statistical artefact. They'd be
| running routes that are completely packed in one
| direction and not so full in the other due to seasonal
| effects or due to day/night cycles. So even if they were
| trying to overbook they'd still have quite empty planes
| much of the time.
|
| 85% capacity use of an asset is really quite high. If
| they managed to achieve mid-high 90s that would be
| startling given how good humans are at missing flights
| and changing plans.
|
| To repeat myself, if the _plan_ is to leave your capital
| unutilised for 15% of the time, on purpose, when there is
| an alternative, then the planner is a lousy capitalist
| and doomed to soon be a broke one.
| Retric wrote:
| > I'm guessing that is a statistical artifact.
|
| No, it's a difference in business models. Low cost
| carriers approach things very differently.
| https://youtu.be/1-uNMj57Y4c
|
| It's not that their wasting this 15% of their unused
| seats airlines are simply more profitable with this
| pricing model.
|
| "While you might expect the airlines to lower their
| prices a few days before the departure day to occupy the
| last seats, the opposite is true: Selling 20% of the
| remaining seats for $1,500 is more profitable than
| selling half of them for the regular fare of $550."
| https://flightfox.com/tradecraft/how-do-airlines-set-
| prices
|
| Further that's a statistical average, they might not have
| any last minute travelers on flight X or they might sell
| out flight Y 1 hour before departure. As airlines can't
| both raise and lower prices at the last minute they A
| reserve seats for the possibility and B frequency lose
| the gamble.
| roenxi wrote:
| Well, sure, but that is assuming that the market is
| exactly 85 people. If we hold the number of people fixed
| and it is impossible to sell all of the inventory then
| holding back inventory is much more effective - because
| we have assumed it is impossible to sell.
|
| The hypothetical in that article would make more money if
| they sold 80 seats at $495, 15 seats at 900 and then 5 at
| $1500 (that makes $60,600). There are strong incentives
| here to fill the seats.
|
| And they are doing the scalpers trick where someone
| desperate to get on the flight _can_. As opposed to when
| the good would be overbought and someone willing to pay
| $1,500 has to start paying off passengers for their
| booking instead of giving more money to the people who
| put planes in the sky.
|
| Plus, if we're both running this strategy, I have huge
| incentives to offer $1,495 seats to steal your high
| paying customers off you. It just doesn't work as a
| strategy unless it is already impossible to fill the
| plane - which is quite likely the case.
| Retric wrote:
| No, the math works fine. Ignoring baggage fees and first
| class vs catch etc. If you have a flight with 300
| identical seats and you could sell everyone single one of
| them for say 100$ and that's your maximum possible
| revenue from a single price point. Now the question
| becomes how do you capture value from people willing to
| pay more than 100$? You can play some games with round
| trip tickets and minimum stays, but again let's ignore
| that and just focus on the ramp up.
|
| If you designate say 75% of your ticks at a lower price
| of X then some people willing to pay more will just buy
| at that price. Essentially the trick is to minimize
| people who are willing to pay more who end up buying
| cheaper tickets. And it turns out people booking close to
| the flight are generally willing to pay more. Sure six
| months out they still sell off up to 75% of tickets at
| ~100$ raising or lowering prices based on demand so their
| losses are limited if nobody else buys the ticket the
| flight is still mostly full. But at that 75% they start
| the ramp up and they also ramp things up as the flight
| gets close.
|
| 2 weeks out they say all tickets are 200$ even if some of
| those 75% are unsold. At the last day bump it to 400$. If
| over 1 month we can ignore seats at 100$ because that's
| unchanged. Sell 1,000 seats at 200$, and 500 seats at
| 400$ and fly with say 1500 empty seats that's 400,000$
| where you would only make 300,000$ if all 3,000 seats
| where sold for 100$. But what if they dropped prices at
| the last hour? Well most of the time they have empty
| seats so many would avoid the 400$ ticket and would tend
| to wait around for that window especially for flights
| from A to B leaving every hour. Peak prices are a game of
| chicken and they can't blink or they lose billions in
| revenue.
|
| This is of course heavily simplified but it does
| demonstrate the basic trick I am talking about where they
| extract value from unsold inventory.
| roenxi wrote:
| You're running in to a pretty fundamental problem with
| the maths here - if we have Retric-Air and Roenxi-Air,
| Roenxi-Air is going to be making more money because my
| plan is to copy your plan then sell a couple of extra
| $100 cheap tickets to fill the plane up. Your strategy is
| completely dominated by a strategy that just does that
| and sells a few more tickets. You're segmenting the
| market, I'm segmenting the market _and_ fully utilising
| my capital.
|
| I can tell you why the airlines would be planning on
| having empty seats in practice - because there are
| sometimes literally not enough people interested in
| travelling to fill the aircraft, so they adopt a strategy
| of leaving empty seats because they have no other option.
| If you've ever flown some god-awful connecting flight at
| 2am you might have seen that in action yourself. But that
| isn't because the airline is choosing to reserve seats,
| they'd much rather have more passengers - that just isn't
| an option.
| Retric wrote:
| > copy your plan then sell a couple of extra $100 cheap
| tickets to fill the plane up.
|
| How and or when exactly to you plan to sell those
| tickets?
|
| Do it after the price hike and people will just wait.
|
| Do it before and you need to see the future to know how
| many seats will eventually be sold otherwise you just
| traded a 400$ ticket for a 100$ ticket. It's no more a
| viable option than suggesting it's easy to win the
| lottery just pick the correct numbers.
| skybrian wrote:
| Fair enough, my explanation was simplified and yield
| management is complex. Planes are full so airlines seem
| to be be doing better at it, though.
|
| What raises the difficulty is that tickets expire - not a
| problem with selling electronic parts, though they do
| eventually become obsolete.
| bildung wrote:
| _> The point is, it 's better to have the option to buy
| something at a high price_
|
| On a macro level this doesn't change anything (besides
| distribution in a limited way), as this doesn't increase
| production, or am I missing something?
| PicassoCTs wrote:
| Scalpers hedge on the fragility of just-in-time - they milk
| the short-term thinkers for all they saved in the good times
| and are thus a healthy part of the market.
|
| Why do we praise people betting on actors being hurt by bad
| decisions like (https://en.wikipedia.org/wiki/Michael_Burry)
| but condemn the same behavior on the smaller scale of
| physical products?
| the__alchemist wrote:
| Scalpers hurt anyone launching a hardware product who
| doesn't have the order quantity to buy direct-from-
| manufacturer.
| chrisseaton wrote:
| I don't get how it hurts anyone to have to pay market
| rate. If your product doesn't work at market prices, then
| that's your problem - not scalpers.
| yxwvut wrote:
| This kind of perspective where any intervention-free
| (often equated with 'free market') outcome is ipso facto
| a socially good outcome is so frustrating because it
| transcends policy discussions into morality/dogma. Are
| you opposed to efforts to curtail rent seeking more
| broadly?
| lmm wrote:
| Making honest prices illegal is the most destructive
| intervention you can do. "Scalpers" aren't rent-seeking,
| quite the opposite.
| the__alchemist wrote:
| I think you'll find most electronics products available
| to be unprofitable if they had to use these scalpers as
| suppliers.
| sannee wrote:
| I, for one, am happy that I can get enough parts for a
| prototype run even if at 5x the price.
|
| Especially as otherwise, those parts would just get sold
| to the car manufacturers and would be used to make
| ethically questionable products.
| babypuncher wrote:
| Scalpers do hurt innocent consumers, which is why they are
| so widely hated. Someone trying to buy their spouse a GPU
| or a PlayStation for Christmas isn't the one responsible
| for a fragile just-in-time supply chain. Many times, the
| problem isn't even the supply chain, it's just the fact
| that demand exceeds the total possible supply, like with
| concert tickets.
|
| In the consumer space, there are many ways for vendors and
| retailers to combat scalpers, but their motivation to do so
| is minimal. They make the same money off a GPU or
| PlayStation regardless of who buys it.
| m4rtink wrote:
| Would they not harm also reguar manufacturers who just want
| to make a stock of some part before starting a
| manufacturing run ?
| hef19898 wrote:
| Well, I guess it would be hard to scalp on of the closest
| managed inventory processes around. Thing is, only the last
| steps before FAL are real JIT, everything else is pretty
| much running on, more or less well amanged, inventory.
| Also, blaming the chip shortage exclusively on automotive
| and their mismanaged JIT is quite a theory, and an overly
| simplistic one.
| the__alchemist wrote:
| Negative. Like scalping everywhere, they're middlemen who
| contribute nothing to society, and make it more difficult for
| people who do.
| thow-01187 wrote:
| They provide short-term, non-committal inventories and
| buffers to a supply chain that doesn't have them, since it
| runs on long-term contracts. In some ways, they're
| capitalizing on the failures of just-in-time inventory
| dogma
| rtpg wrote:
| The chips would have been sold in any case!
|
| They're taking advantage of some fluxuations to make
| money for themselves. That isn't helpful for the producer
| nor for the purchaser of the goods.
|
| This isn't people setting up futures for 555 timers. This
| is people scooping up PS5s and immediately selling them
| for an extra $200.
|
| Of course it's nobody's god-given right to own a PS5 but
| there's not value being produced here.
| milesvp wrote:
| So, you may be right about scalpers providing nothing to
| society. But you are absolutely wrong about middle men in
| general. At a super high level, they have to provide value
| else they would be short circuited. Very often this value
| is in knowledge, both product knowledge, customer
| knowledge, and market fit. A good middle man can tell you
| that the thing you think you want won't fit your needs as
| well as some other product (bonus points if the product
| isn't something they personally sell). You will also find a
| high correlation between the health of an economy, and the
| number of middlemen present. It's actually something that
| has concerned me in the US for several years, that too many
| companies have been squeezing out the middle. I think it's
| exacerbated the current supply chain issues.
| pishpash wrote:
| Middlemen are good if they unbundled and directly charged
| for their services and did not act as arbitrageurs
| simultaneously. Middlemen who withhold information or
| resist competition are rent seeking, which is a strictly
| negative utility for society.
| blevin wrote:
| Some have argued that scalpers, like other risk
| arbitrageurs, accelerate market price discovery. If you buy
| the argument that markets are net positive for society by
| relaying information about economic trade offs, scalpers
| aren't necessarily bad even if they are indeed annoying to
| market participants by lifting the ask. Of course there are
| extreme conditions where we also might decide that using
| money as the universal conveyance of value is a bad thing
| because it reveals how unequal outcomes in society have
| been... And the usual response is to shift to rationing
| rather than price to allocate scarce resources. But with
| rationing you get sidechannel markets and not necessarily
| efficient allocations.
| Swenrekcah wrote:
| This argument feels wrong to me. If there is a market for
| the chip, it will find a market price. If there isn't
| there isn't. If the market is in an equilibrium and the
| chip manufacturer makes some money on their chips, and
| the chip buyers make some money on their products, the a
| scalper coming in and sucking up all the profit isn't
| doing anybody in the world any good except themselves.
| skybrian wrote:
| Equilibriums don't just happen by themselves. When there
| isn't an equilibrium, delaying sales by keeping inventory
| helps the people who didn't plan ahead.
|
| The ant planned ahead for the winter, the grasshopper
| didn't, and the scalper provides a service to the
| grasshopper, for a price.
| medvezhenok wrote:
| The scalpers don't suck up profit, since if there is a
| functioning market, you can't really scalp.
|
| Scalping exists when there is a discrepancy between a
| marked price and the market price of an item. If scalpers
| were not a thing, you would have shortages. With
| scalpers, you still have shortages, but you can acquire
| the good by paying a higher, market clearing price.
|
| That higher price either makes it so that rich people can
| get the thing (most don't like this), or that people who
| really need it can get it (i.e. lifesaving medication
| etc). So your view of scalpers might be influenced by the
| distribution of (1) and (2) going on.
| nicoburns wrote:
| My observation is that you mostly get (1). And this is
| also why wealth inequality (both on a personal and a
| corporate level) is so bad.
| Swenrekcah wrote:
| Sure, I get all that but scalping is still in essences a
| leeching practice.
|
| And yes they can suck up profits, that's their whole
| thing. Are you saying that profits can't exist in a
| functioning market?
| bluecalm wrote:
| Well, they provide value. They make it possible for
| people/entities who needs things the most to actually get
| them instead of those who happen to be first in line or in
| lucky position to get access to supply.
| TeMPOraL wrote:
| Correction: they make it possible for people/entities
| _who can afford to waste most money_ to get them instead
| of those first /lucky. But how is that a better outcome?
| And why should this involve people spending more money,
| and all the delta going to the person who was first in
| line or in lucky position to secure a loan and buy off
| all the supply?
| lmm wrote:
| > they make it possible for people/entities who can
| afford to waste most money to get them instead of those
| first/lucky. But how is that a better outcome?
|
| It's not "waste", it's the people who are willing to
| _spend_ the most money, which are presumably the people
| who want /need the thing most, so it's better than
| allocating the thing at random.
|
| > And why should this involve people spending more money,
| and all the delta going to the person who was first in
| line or in lucky position to secure a loan and buy off
| all the supply?
|
| The person who makes a good judgement about what things
| are underpriced is selling a service to the market and
| earning their cut. A seller who's paying attention should
| see the rush and raise their prices (and ideally increase
| production to match that).
| puszczyk wrote:
| > It's not "waste", it's the people who are willing to
| spend the most money, which are presumably the people who
| want/need the thing most, so it's better than allocating
| the thing at random.
|
| It's not a waste, but it's not best allocation either. It
| seems like the chips will go to established players with
| large and cheap credit lines and ossify the market even
| more.
|
| The scalpers are not like market makers who are
| regulated, provide both bid and ask, and whose spread is
| usually quite small in comparison to scalpers.
|
| https://www.investopedia.com/terms/m/marketmakerspread.as
| p
| medvezhenok wrote:
| Scalpers allow people who are not price sensitive or have
| inelastic demand priority over people who are lucky /
| first.
|
| The ethics depends on the exact case study provided. If
| it's a rich person buying an xbox (not price sensitive) -
| that's one thing, and most people would not support it.
| If it's someone needing an IC for a heart monitor to stay
| alive (inelastic demand), most would say that providing
| them an IC over someone who wants to play the latest
| video game is a good service.
|
| Scalpers do both (1) and (2).
| nicoburns wrote:
| Scalpers only do (2) for those who can afford it. If
| scalpers were willing to hand out goods on the merit of
| the application rather than profit then I'd have much
| more sympathy. But then they wouldn't really be scalpers
| anymore.
|
| I'm willing to bet that scalpers starve critical
| applications of goods far more than they provide them.
| Providers of critical services are usually poorly funded.
| bluecalm wrote:
| Or maybe they are price sensitive but the goods are just
| worth more to them.
| TeMPOraL wrote:
| The scalper can't distinguish between a poorer person who
| really needs a thing, and a richer person who just kinda
| wants it. They will happily price out the former before
| the latter gives up.
|
| There seems to be an assumption in the discussions about
| the market that people don't do stupid shit with money.
| That the same good cannot be both life-critical for one,
| and a source of cheap entertainment for another. That
| people only ever spend money to make more money. That
| they are perfectly consistent over time. That nothing is
| ever time-critical, it may be only time-discounted.
|
| But the reality is, people are irrational, things take
| time, and markets have inertia. In a scalper-managed
| shortage of critical medication, it's perfectly possible
| for a rich person who watched one too many end-of-the-
| world movies to buy up the supply at high markup, to
| stock their fallout shelter, and have it rot there while
| people who need it die. It takes time for a chip scalper
| to insert themselves into the market, buy up the supply
| and advertise their existence - in that time, the
| factories might be wasting megadollars of money.
| medvezhenok wrote:
| > Well, they provide value. They make it possible for
| people/entities who needs things the most to actually get
| them instead of those who happen to be first in line or
| in lucky position to get access to supply.
|
| True - they also take on some risk of being stuck with
| inventory that they can't resell at a profit (if prices
| drop between when they buy and sell).
|
| Ethically scalping feels wrong, but I think ethics aside,
| scalping does provide a service to the market.
| Lev1a wrote:
| > Ethically scalping feels wrong, but I think ethics
| aside, scalping does provide a service to the market.
|
| Yeah fuck ethics, there's profit to be made.
|
| /s
| 10000truths wrote:
| It depends on what is causing the lack of supply. If the
| bottleneck lies in factors beyond the control of consumers,
| i.e. discontinued production, or shortage of raw material,
| then I see no inherent issue with scalping. But if it's the
| scalpers themselves that cause an otherwise plentiful supply
| to become scarce, then they are the cause of the shortage,
| rather than the effect, and their behavior should be curbed.
| The problem is that the former situation can easily lead to
| the latter via a panic buying feedback loop, and it's not
| entirely clear where the distinction should be drawn.
| pishpash wrote:
| They could only do that by cornering the market, but if
| there are many competitive scalpers, then the price is
| right and that's just normal supply (at the source
| supplier, not the scalper) and demand.
| esyir wrote:
| Except that your markets are not perfect, your scalpers
| have overhead and now represent a middleman who wants
| their cut.
| pishpash wrote:
| If the buyers could participate in a bidding market
| directly at the supplier, there would be no need for this
| overhead. The overhead you speak of is the cost of
| running a liquid market for a particular good where none
| existed.
| jimmydorry wrote:
| Except this is not really what market makers do. The amount
| of liquidity they can provide by buying high and selling low
| is quite limited, not to mention it locks up a lot of capital
| in market price speculation with the significant risk of
| 'getting it wrong'.
|
| Without going into motivation behind why ($$$), they will
| sell any share in demand at the prevailing market rate. As
| long as they later buy the same number of shares that they
| sold into the market, everything continues to work. By
| internalizing and batching orders, they can also exhert force
| on the price to ensure they don't lose on these 'market
| making shorts'.
|
| For your example to be equiavlent, scalpers would need to
| sell parts that they don't have, which falls apart as an
| analogy as such games would fall apart quite quickly during a
| supply crunch.
| newswasboring wrote:
| You are literally defending unnecessary middlemen. They add
| no value, all they do is create artificial scarcity. If they
| didn't exist someone would have made use of the chip. Instead
| they hoard it. I don't understand why you find this ok
| behavior
| mey wrote:
| They make supply chain validation problematic and introduce
| room for fraud. Not saying market making is bad, just in this
| case loosing supply chain validation may be worse.
| raxxorrax wrote:
| Question is if that really provides benefits for the economy
| though. For scalpers and the stock market alike.
| codazoda wrote:
| I think this would be against the law in the U.S. (although
| probably hard to prosecute). After looking through a few of
| these, however, it looks like most of them are in other
| countries, so different laws apply.
| chmod600 wrote:
| Against what law? Isn't speculation pretty normal in a lot of
| markets?
| ajmurmann wrote:
| There are laws against price gouging. I believe those only
| apply during emergencies.
|
| Personally, I believe it's manufacturers not asking for the
| price the market is willing to pay and scalpers taking
| advantage of that. Charging real prices also can prevent
| hording in certain emergencies.
| simonh wrote:
| Manufacturers aren't always able to charge real market
| prices in a flexible way. They rely of regular reliable
| order volumes and can't charge different prices to
| different customers, and can't vary prices easily day to
| day so can't take advantage of the fact different
| customers are willing to pay different prices. They also
| often don't have distribution and extensive dispersed
| inventory, so can't offer different prices to different
| geographic markets, or different markets with particular
| volume requirements, or different order/delivery latency
| tolerances.
| wallaBBB wrote:
| General electronics yes, but automotive ICs are not in free
| sales and can't be stocked by 3rd parties. Also giants like
| apple, amazon,... buy directly from the manufacturers with
| orders being made often a year in advance.
|
| This shortage is so big that the 3rd party scalpers are
| insignificant contributor to it.
| cwkoss wrote:
| Is there a DIY chip fabrication scene? What is the cutting edge
| of what hobbyists are doing in their own garages?
| nosianu wrote:
| That was actually a post here on HN just a few weeks ago.
|
| Here's one "point of entry" (to find the homepage and similar
| videos and pages): https://youtu.be/IS5ycm7VfXg "Upgraded
| Homemade Silicon Chips"
| cwkoss wrote:
| This is exactly what I was looking for, thanks for sharing!
| turbinerneiter wrote:
| I hope a lot of car industry supply chain managers are losing
| their jobs now. Worst people ever. Hurt their suppliers, hurt
| their own company, out of sheet arrogance and ignorance.
|
| On the other hand, good for us, any ICE car or car in general
| that is not produced is good for the environment.
| carlmr wrote:
| It's not like the supply chain managers had much choice in
| this. For years they would have been fired for keeping too much
| stock around.
| turbinerneiter wrote:
| True. Whoever made these choices then. Incompetent
| management. 100s of workers are losing their jobs because of
| them.
| carlmr wrote:
| Well these hundreds of workers wouldn't have had the job if
| they hadn't operated efficiently for the preceding 20
| years.
|
| It's a bet that has probably paid off, even including the
| current situation.
| megablast wrote:
| Finally some good news.
|
| Less cars is a global good thing.
| Unklejoe wrote:
| People will just keep driving their older cars which pollute
| even more.
| ok123456 wrote:
| There haven't been many breakthroughs in the past twenty
| years in regards to fuel efficiency. They're just gaming the
| numbers at this point by making the engines have higher and
| higher compression at the cost of making them less and less
| reliable.
|
| Maybe old cars being dramatically less fuel efficient was
| true in the 90s when an "old-car" was from the 70s.
| minhazm wrote:
| Tesla has done a decent job of mitigating some of the chip
| shortages since they are so vertically integrated. Though
| obviously Tesla produces way less cars than Toyota/Honda/VW. But
| other manufacturers simply can't do this even if they wanted to
| since they outsource most of this stuff.
|
| > "We were able to substitute alternative chips, and then write
| the firmware in a matter of weeks," Musk said. "It's not just a
| matter of swapping out a chip; you also have to rewrite the
| software."
|
| https://www.theverge.com/2021/7/26/22595060/tesla-chip-short...
| blackguardx wrote:
| They also just completely dropped a feature - radar - because
| they couldn't get parts for it. I'm not sure other
| manufacturers would be able to do that either due to internal
| processes or being able to risk their reputation.
| speedgoose wrote:
| I'm expecting them to turn the radar off at some point on the
| cars with a radar, because in my own experience driving
| Tesla, the radar was good to trigger phantom breaking.
| [deleted]
| imeron wrote:
| Volvo dropped a security package too because of the chip
| shortage: "Volvo is contacting customers who have specified
| the Driver Awareness package to ask if they want to continue
| with their orders without the equipment, or wait until the
| kit becomes available once more."
|
| https://www.autocar.co.uk/car-news/industry-news-
| manufacturi...
| chrischen wrote:
| Tesla dropped radar because they are moving to vision only
| systems like how the Comma AI/OpenPilot works. Vision models
| are superior to radar since radar can't detect stopped
| obstacles.
| Smashure wrote:
| Radar can absolutely detect stationary objects. Your
| vehicle moving at 50 mph means a stationary object is
| moving at 50 mph relative to your radar.
| chrischen wrote:
| Yea but they need to distinguish between the stationary
| objects that are inconsequential to the car.
| jsight wrote:
| From their comments about it being a setback, it doesn't
| sound like it was planned to happen so quickly.
| FartyMcFarter wrote:
| Indeed - not many manufacturers could get away with Tesla's
| strategy of charging money for features that are in Alpha
| state, to put it charitably (e.g. Autopilot).
| speedgoose wrote:
| Many manufacturers had no shame to charge for shitty
| features in alpha state like the "ping pong" line assist.
| mnholt wrote:
| Well they aren't going to "ping pong" themselves into a
| parked emergency vehicle.
| practice9 wrote:
| Right, because it will just turn off itself randomly and
| run full speed into vehicle ahead.
|
| Even Tesla's basic autopilot is far ahead of competitors
| and it's already included in base price.
|
| Many companies will rip you off for far more basic cruise
| control
| FartyMcFarter wrote:
| > Even Tesla's basic autopilot is far ahead of
| competitors
|
| Depends on how you define "competitors" I guess. It
| doesn't seem to be ahead of Waymo.
| marvin wrote:
| My Skoda Citygo's line-keeping assist tries to drive me
| into the barrier every single time I go driving. Only a
| firm hand on the steering wheel prevents disaster.
| severino wrote:
| > and then write the firmware in a matter of weeks
|
| Well, it doesn't sound very reassuring to read that they just
| swapped out some chips here and there and then "hacked" the new
| firmware in a couple of weeks. It may be the chip for the FM
| radio or it could be part of the breaking system.
| KptMarchewa wrote:
| Don't worry, they've been hacking the self driving code for a
| few years now.
| ilyakrotov wrote:
| Seems like the best time to start a mining startup
| aazaa wrote:
| > Stellantis has halted production at other plants, including in
| Europe and Canada, forecasting that it would make 1.4 million
| fewer vehicles this year due to the chip shortage.
|
| For perspective:
|
| > Combined sales of FCA and PSA totaled 6,206,000 units in 2020,
| down by 22% compared to 2019 figures. When the two companies
| announced their decision to merge, they became the world's 4th
| largest automaker by sales volume. It was only outsold by
| Volkswagen Group, Toyota and Renault-Nissan-Mitsubishi alliance.
| With 7,907,000 vehicles sold in 2019, FCA-PSA (which was not
| called Stellantis by then), was bigger than GM and Hyundai-Kia.
| One year later, these two outperformed Stellantis.
|
| https://fiatgroupworld.com/2021/02/14/stellantis-sold-6-2-mi...
|
| If I'm reading this right, pre-pandemic sales were ~8 million. So
| a cut 1.4 million due to chip shortages represents an 18% drop.
| But compared to 2020, the drop is 23%.
|
| That's disastrous hit for any company to withstand.
|
| I'm curious how much of this is actually due to chip supply vs.
| how much could be due to other factors, but blamed on chip
| supply.
| timmg wrote:
| > If I'm reading this right, pre-pandemic sales were ~8
| million. So a cut 1.4 million due to chip shortages represents
| an 18% drop. But compared to 2020, the drop is 23%.
|
| But it's a low margin industry. They can now charge _above_
| MSRP. If they aren 't stuck paying for parts (or labor) of the
| units they can't make, they might come out ahead. Fewer units,
| waaaay more profit per unit.
| whiteboardr wrote:
| @kliment summarized the why pretty well:
|
| https://news.ycombinator.com/item?id=26931498
|
| Curious if this is true for all manufacturers.
| isoprophlex wrote:
| What an amazing comment; penetrating insight clearly
| communicated. Thanks for sharing.
| lvl100 wrote:
| This is not true at all. How many chips do you think the car
| industry needs for car parts? How many cars do you think they
| sell in a year? It's not hard to figure it out. People
| parroting this narrative have no idea what's happening behind
| the scene.
| mendigou wrote:
| Most of us affected think it's very true. There are 60-70
| million cars sold worldwide each year and many chips of
| different kinds in each.
|
| If you have some deeper insight it'd be great to share it.
| lvl100 wrote:
| What we are seeing is basically hoarding across the board
| and pandemic-induced manufacturing disruptions. And
| suppliers are going along with it because they make
| substantially more profit in this situation. This notion
| that car manufacturers are responsible for halting the
| entire world for chips is simply a narrative to hide what's
| really happening. Even if car mfgs cut production due to
| pandemic miscalculations, that's at best 5-10%. That alone
| is not enough to shut down factories. And we are more than
| one full cycle out of the pandemic. We are still talking
| about a supply chain that was state of the art. If you
| think they didn't adjust (to some 10M unit miscalculation)
| by now, I don't think you should be writing articles on
| this topic.
| intricatedetail wrote:
| What would cause pretty much all STM32 microcontrollers to be
| not available and any amount that shows up disappears within
| minutes? Then you can buy pretty much any part from China
| without issue?
| baybal2 wrote:
| Chinese people stopped hoarding luxury apartments, and
| started hoarding microchips -- a popular explanation
| a9h74j wrote:
| > a popular explanation
|
| When I was a kid, the urban legend question was: What if
| all of the Chinese jumped off a platform at the same time?
| Would it shake the other side of the world?
| MetallicCloud wrote:
| One of my favourite what ifs https://what-if.xkcd.com/8/
| Inviz wrote:
| STM32s from China increased 3 to 5 times in price in last 6
| months, biggest jump happened in last 6 weeks. STM32L family
| is especially hard to buy.
| ladyattis wrote:
| I know that even SMD transistors got hit hard by the automaker
| component switch-a-roo. It's not too easy to find RF
| transistors even for signal amp work like I do for a hobby.
| It's just a disaster right now.
| da_chicken wrote:
| The "religious reasons" he's talking about are "zero inventory"
| or "JIT inventory" pioneered by Japanese auto makers in the 80s
| and 90s. By optimizing inventory management and understanding
| demand for your product, you can ensure you don't have excess
| inventory on-site (meaning you don't have money invested in
| product parts you can't sell and have to pay taxes on). It's
| the system that virtually every manufacturer (auto or
| otherwise) uses now.
|
| It's why major supply chain issues cause catastrophic
| manufacturing problems.
| j-bos wrote:
| My understanding is that JIT, as performed by Toyota, takes
| into account the differences in difficulty of sourcing
| different inventories. If this is true, one would expect that
| Toyota faced shortages later than other manufacturers. Does
| anyone have a source proving or disproving this?
| da_chicken wrote:
| It can take into account _predicted_ difficulties. The
| pandemic was difficult to predict, basically everyone
| predicted incorrectly, and chip supply is functionally
| inelastic over the short term.
| kenhwang wrote:
| Toyota got a foreshock of the chip shortage during the
| 2011 earthquake/tsunami/nuclear disaster. So they started
| stockpiling chips then; from their standard 3-month
| supply to 6-month supply.
|
| They figured that would've been enough to survive another
| incident of similar scale.
|
| So they had no problem with car inventory for a half a
| year longer than every other automaker, until their
| additional buffer of chips also ran out.
| lenzm wrote:
| You don't need to know what the pandemic is specifically
| to plan for a global market shock. Knowing that you have
| a critical component with a long inelastic supply chain
| is enough.
| SahAssar wrote:
| I'm guessing the problem is to decide what is a
| reasonable difficulty. Even if you plan for a global
| market shock, how long do you plan for that to continue?
| How many companies failing in your supply chain do you
| plan for?
| hef19898 wrote:
| And then what? Just stockpile a year of everything? At
| every company along the supply chain? It is the first
| time in my life, professional in SCM and otherwise, that
| something like Covid and a global trade disruption
| happened together with a global shortage of one class of
| products. No way you for see or prepare for something
| like that.
|
| Hindsight in 20/20, just imagine the automotive OEMs
| would have gotten rid of the JIT for chips and Covid (and
| all the other things causing the shortages) wouldn't have
| affected chips but, say, certain raw materials like
| Aluminium.
| Kliment wrote:
| That's not the issue here. The issue is automotive are
| capricious, nasty customers. They know they're a big
| contract so they dictate disgusting terms, like 9 month
| payment terms and extremely strict delivery windows and
| changing deliveries on very short notice. Suppliers get
| _fined_ at certain auto manufacturers for not delivering
| within a _15 minute_ window, forcing their truck drivers
| to circle around the facility for hours to ensure they
| can meet that. The carmakers require extreme delivery
| flexibility from their suppliers on short notice. In
| effect, they 're still holding stock, but they're forcing
| their suppliers to hold it for them, and without said
| suppliers getting paid, or even having the ability to
| plan for how much they'll get paid.
|
| Because of those extremely hostile contract terms, the
| carmakers could just turn around and go "oh yeah, all
| that stock we said we'd order this year, you can make it
| if you like but we're not going to take deliveries or pay
| for it" which is what set this whole pile of bullshit in
| motion. At that point, their suppliers were holding
| and/or producing lots of stock for them, but got informed
| they would not be getting paid for it, had to cut their
| losses, and this ended up disrupting manufacturing for
| months as lines had to be reconfigured mid-batch and a
| lot of product got scrapped. While this was happening,
| the automotive fuckers changed their minds and requested
| more, meaning the suppliers had to scramble to produce
| with now limited resources because the scrapped stuff was
| still clogging the pipeline, so resources got redirected
| away from every other part.
|
| In short, religious JIT could only have this kind of
| impact here because the automotive companies are absolute
| shits to their suppliers and could force them to jump one
| way and then the other, causing disruption upstream which
| then spread downstream to everyone using electronics.
| This is a purely artificial crisis caused by the car
| manufacturers and is not an inevitable consequence of
| either the pandemic or the logistics disruption. Air
| cargo is barely affected and semiconductors and their
| precursors (except for water) are light and easily
| transportable by air, and certainly valuable enough that
| this does not impact their cost. This is a problem that
| would not have existed without the automotive industry,
| covid or no covid. They brought this upon themselves, and
| now everyone else is suffering (and auto execs go on TV
| and blame work-from-home and remote education for the
| shortage, which is just adding insult to injury). Screw
| them.
| hef19898 wrote:
| Pretty sure 9 months payment terms are illegal in the EU,
| everything above 90 days is an issue already. Not
| defending the supplier squezzing that auto OEMs conduct.
| Also, trucks aren't circling around facilities, they are
| waiting at parking lots.
|
| Seriously, I don't know what kind of axe you have to
| grind with automotive and JIT. It does seem to be a
| larger issue if it is affecting all industries, and all
| companies. Chip shortages are affecting Aerospace, Google
| reportedly has issues getting chips as well for things
| like the Pixel 4a.
|
| Also I am not sure if you have hands on experience with
| SCM or procurement, automotive or otherwise.
| Kliment wrote:
| I've spoken to suppliers who had 9 month payment terms to
| automotive (and other transport, train manufacturers are
| just as bad) customers. The law change in the EU was
| triggered by exactly such excessive contract terms.
| They're still common in other areas where regulators have
| not yet stepped in. I know the area where the factory in
| TFA is based, and I can tell you they don't have nearly
| enough parking space for deliveries, which is one reason
| they insist on tight delivery windows. I happen to know
| truck drivers and they hate this arrangement as in
| practice this means they have to plan to get there way
| earlier and then either park on the side of the road or
| circle around. All nearby truck parking facilities are
| perennially full. These factories have a habit of
| externalizing this kind of additional costs to suppliers
| and simultaneously squeezing them for price, not to
| mention causing broader damage to society by clogging the
| roads and parking facilities, but that's beside the
| point.
|
| And yes, I happen to have hands on experience with
| procurement and sourcing. I've been redesigning customer
| projects around missing parts all year. Every industry is
| affected, but it's automotive which started it, and
| caused suppliers so much damage. This is what suppliers
| tell me and I have no reason to distrust them. My axe to
| grind is that I'm now dealing with the fallout.
| hef19898 wrote:
| Did automotive start it, or was automotive just hit
| first? I don't know, and I think might take a while until
| we know. I have to agree that 9 months payment terms are
| unacceptable. That truck yards at warehouses and
| factories are full has more to do with bad yard
| management, or non at all. That is less a problem with
| JIT or procurement, instead it is a purely operational
| issue.
|
| That us in SCM and logistics, incl. procurement, have
| tendency to push issues down to lower tiers is true. it
| is also true that logistics and transportation is
| offloading a lot on public infrastructure. Does it have
| to be that way? On the one hand, yes. Roads are public,
| railway lines more often that not as well (to an extent
| that is). That's what taxes are there for, because
| indirectly everyone if profiting from a running economy.
| Again, that is less the case in developing countries and
| should change. I also agree, and that is maybe even more
| important when it come to the environment at large, SCM
| should prioritize environmental and climate protection
| more, along with social standards. That won't happen so
| until it is financially beneficial to do so. This is a
| general issue with capitalism running rampant so.
| Chemical plants giving a shit about worker health and
| safety or the environment is as old as chemical
| manufacturing., just as an example.
| bsder wrote:
| > And then what? Just stockpile a year of everything?
|
| Or run a fab. Fabless isn't a God-given right. Vertical
| integration is a thing.
|
| Vertical integration got a bad reputation because
| financial engineering dipshits like Carl Icahn would come
| in and strip mine your company for the single super
| profitable division and destroy the rest (see: Mesta
| Machinery).
| hef19898 wrote:
| Sure, that's a solution. Or own one as subsidiary. Not
| sure if would have really helped so, there were decisions
| to order less. Reasonable to assume that production at
| the own fans would have been ramped down as well.
| bsder wrote:
| Sure, but your own fab will prioritize your own chips in
| the order that they need to.
|
| TI doesn't care about that 50 cent part that's holding up
| your ability to produce a car. They're going to run every
| chip first whose profit per chip is higher than yours.
|
| On the other hand, your own managers will have lots of
| incentive to produce that 50 cent chip if it is in the
| way of several thousand dollars of profit from selling a
| new vehicle.
|
| 200/150mm wafer at 180/150nm node fabs are not that
| expensive to run and maintain. But they have annual capex
| and MBA types don't like that.
|
| In addition, that fab probably won't compete well in the
| general market so it's effectively a captive fab.
| However, you'll have internal managers complaining that
| they have to use the internal chip which is more
| expensive than the one from TSMC because their bonus
| depends upon getting 5% cost savings next quarter and who
| the hell cares about keeping our fab filled so it's
| around when everything goes pear-shaped--that's somebody
| else's problem after I've been promoted and gone.
| hef19898 wrote:
| Automotive suppliers pretty much care about 50 cent parts
| holding up OEMs, penalties are prohibitively high for a
| reason. An in-house fab is, as you said, probably more
| expensive. Simply because it has to rely on a single
| customer. Show me _one_ company that is not looking at
| costs, one way or the other, that stays in business in
| the long run. Not doing so has, yes, something to do with
| savings on the procurement side (errors were made there
| as much as everywhere else). It also has something to do
| with long-term survival, and that does include jobs (even
| if that turned into a trope by now, there is some truth
| to it). Not every company can use VC money to bolster
| competitiveness, most have to compete on cost, and there
| every cent counts. Especially when we talk about high-
| volume products.
| forbiddenlake wrote:
| Yes: https://news.ycombinator.com/item?id=28232469
| hef19898 wrote:
| Toyota was among the last to be hit. Also, JIT is not
| having zero inventory. It is about having the right amount
| of inventory.
| worldsayshi wrote:
| Pedantic comment: is that not what lean is about? Or is
| "lean" and jit essentially the same thing?
| hef19898 wrote:
| JIT, as Kanban, is part of the Toyota Production System.
| It is also called Lean nowadays, or simply TPS. The basic
| principles go back to the US defence industry in WW2, on
| one hand, and some ingenious ideas from the old Toyota
| company manufacturing looms.
|
| I also see some of these ideas, tacted assembly lines for
| example, as far back the Venetian Arsenal cranking out
| Galleons and Galleasses in unprecedented numbers in the
| 16th (?) century.
| tuatoru wrote:
| The conventional wisdom is that Toyota (and Honda,
| Nissan, etc.) learned the value of keeping buffer stocks
| after the 2011 Tohoku earthquake.
| hef19898 wrote:
| JIT always has _some_ buffer, just smaller ones than in
| other models. True that Japanese manufacturers increased
| those after 2011.
| imeron wrote:
| https://www.bloomberg.com/news/articles/2021-04-07/how-
| toyot...
|
| It wasn't enough it seems.
| xondono wrote:
| What I don't see discussed is how JIT has become the
| "securitization" of manufacturing.
|
| Everyone had an incentive to do JIT, and it improved
| efficiency in each individual company, but it did so by
| inflating a systemic risk that could be easily triggered by a
| "black swan".
| wnissen wrote:
| The thing is that it also reduces the risk of certain
| systemic risks. Recessions (and even worse, deflation)
| happen when production is too high relative to demand, but
| no one has noticed. In the 80s if demand for cars dropped,
| everyone from the dealers to the manufacturers to the parts
| suppliers were left with a ton of excess production. In the
| best case, you merely transfer some production from the end
| of a boom to the beginning of the end of the bust, but in
| the worst case all that inventory just sits around and
| deflates.
| hef19898 wrote:
| And major manufacturing problems cause catastrophic supply
| issues some times. manufacturing is part of the supply chain,
| and it is simply impossible to protect against all
| eventualities. JIT is not to blame here.
| da_chicken wrote:
| > it is simply impossible to protect against all
| eventualities.
|
| Of course. No amount of stockpiling will account for a
| moon-sized asteroid collision.
|
| > JIT is not to blame here.
|
| Kind of. JIT isn't to blame, but the pressures that reward
| making every level of industry maximize efficiency, such as
| by using JIT, is. That is the reason for the supply chain
| crisis.
|
| The market and tax laws pressure companies to optimize for
| efficiency as much as possible with their supply chains.
| Another alternative would be to optimize for robustness,
| but that would naturally be inefficient and would still be
| unlikely to endure a 100-year catastrophe unless it were
| completely unable to survive in a competitive market.
|
| That doesn't mean that we need to change anything,
| necessarily, but it does mean that we have structured our
| economy to be less resilient than it could be with
| potentially very little actual upside.
|
| Even so, some supply chains, like food and clean water,
| really should be robust rather than efficient. Emergency
| medical supplies, too, should probably be robust rather
| than efficient. That's why the Obama pandemic plan included
| warehouses of medical supplies [0] and FEMA stockpiles food
| and water.
|
| Utility systems, too, should probably favor robustness.
| Texas has had a horrific year for it's power industry, and
| it has revealed how a hypercompetitive marketplace doesn't
| really serve the public best interest.
|
| Consider civil engineering. We could optimize that for
| efficiency. That would result in a lot more bridge
| collapses, structure failures, and so on. Instead, we
| generally try to overbuild when failure would cause injury
| or death. The same is true in most engineering contexts. In
| many cases, industry simply doesn't design for robustness
| _until they are held liable for failures_. Notice the rise
| in corporate insurance rates after computer security audits
| due to the risk of data loss, and the sudden panic of
| executives to suddenly have secure systems where before
| they were more than happy to have databases of plain text
| passwords and so on.
|
| There are alternatives to profit-motivated business
| efficiency. We have simply chosen not to do that sort of by
| accident.
|
| [0]: https://www.npr.org/sections/health-
| shots/2016/06/27/4830698...
| hef19898 wrote:
| I haven't heard of food or water supply collapsing due to
| Covid, at least not in the developed world. Agree on
| medical and desaster plans and supplies, it seems
| everyone ramped those down after the cold war. besides
| masks, which became scarce early on due to China shutting
| down its economy in the early days of the pandemic,
| medical supply chains also continued to work, hospital
| resources being a bottleneck notwithstanding. And from
| experience, even masks were still avaialble as early as
| February 2020 in large quantities directly from Chinese
| suppliers.
| rcMgD2BwE72F wrote:
| Any carmaker whose cars can't sell will be happy to get their
| suppliers to not supply them with chips.
|
| Let's see how the main EV manufacturers will procure their chips
| in the coming months.
| jbverschoor wrote:
| Or maybe there's just a lack of demand??
| slownews45 wrote:
| Man - the magnitude / impact of these chips shortages on autos in
| particular is crazy.
|
| Regardless of Opel popularity, in the US the F-150 was a best
| selling vehicle and massive cash cow and they had unfinished
| vehicles sitting out. These chips have GOT to be a relatively low
| margin / somewhat lower cost item (ie, feature size can be
| large). What a miss not to have more coverage for them.
| Gunax wrote:
| After a train crash destroyed a few dozen Ford trucks, they
| sent an engineer who was also handy to pry the chips out of the
| smashed trucks. They were hand delivered back to the factory.
|
| Normally this would be ridiculous--there are many other parts
| that were probably more valuable. But now we have people
| cracking open smashed vehicles like walnuts so they can extract
| a chip nominally worth a few dollars.
| Smashure wrote:
| Source? I can only see news about the crash, nothing about
| chip harvesting
| Gunax wrote:
| This was stated on a Ford all-hands meeting September 29.
|
| I also cannot find an external link, but the meeting was
| attended by tens of thousands of Ford employees and
| contractors.
| asdff wrote:
| Auto makers should just buy back leased cars from dealerships
| and harvest the chips. These are cars after all, so the
| chipsets have probably been the same underpowered crapware for
| the last ten years.
| ashtonkem wrote:
| Used car prices are so high, that would probably be pretty
| expensive.
| Ekaros wrote:
| Would this actually ever make any sense? Not counting
| totalled vehicles. There really isn't so much profit in new
| cars price that it pays for used car fully. Unless that used
| car is really heavily used. Which then leads to questions of
| how much lifetime left the parts have.
| asdff wrote:
| They could lobby and get another cash for clunkers sort of
| arrangement from the federal government to incentivize
| dealers turning over leases rather than having them on the
| lot, and having the cost of getting back these cars
| publicly subsidized by the government. The run for used car
| supply right now is entirely due to new car supply being so
| strained. Pushing that demand back to new cars rather than
| used cars puts the profits back into the automakers rather
| than dealerships, and guess who swings with more weight in
| Washington. Not Joe Shmoe Chevrolet from Anytown USA.
| Ekaros wrote:
| How long longest leases are really 7 years? Is there
| relevant usable parts left in those vehicles? On other
| hand with shorter leases like 2, 3 or 5 years the cars
| are still perfectly functional and scrapping them would
| be huge waste just from environmental point alone.
|
| Simplest thing might be just to pay some part of laid-off
| workers compensantion.
| to11mtm wrote:
| That doesn't work in practice; there's a legal difference
| between a part on a new vehicle that was DIT (Damaged In
| Transit) and one pulled out of a lease.
| asdff wrote:
| This is the auto industry we are talking about. If they
| want something that will help them be more competitive or
| float them in hard times they go to congress and get it.
| baybal2 wrote:
| 200mm tapeouts have briefly became more profitable than leading
| edge ones on the wave of panic buying.
|
| On my side, I lost a lot of firmware devs to poaching by
| companies migrating between microchip brands, and ready to pay
| just anything, to the point of me myself being tempted.
| redisman wrote:
| Heck, why not? It's a market economy and we are a commodity.
| Why resist your price going up?
| baybal2 wrote:
| It's an ultimate irony to see that 200mm fabs in the West
| were closed one after another for "low profitability" just
| to see them missing out on this money volcano
| Ekaros wrote:
| If those fabs where still around probably profitability
| would be even lower and there wouldn't be so massive
| profits. Irony is that we haven't been paying some more,
| to keep slack in supply.
| AnimalMuppet wrote:
| Mind telling us whether you're hiring? And, mind pointing us
| to some contacts where your people are going?
| baybal2 wrote:
| Will you be ready to move to China? Working of physical
| products requires being there. We don't do much software
| only projects.
|
| We tried DHLing prototypes around before, it didn't work
| out. People still need tons of expensive tooling, go to
| other specialist companies with these prototypes, etc. Too
| much pingpong
| manquer wrote:
| Taiwan would work too perhaps ? Maybe even South Korea/
| Japan as well.
| paxys wrote:
| One thing that's going to come out of this crisis is cars being
| repriced as not just engine + wheels + seats but rather a
| consumer tech gadget. I expect prices to keep climbing well after
| supply chain issues have been solved. Piling on subscription
| pricing is next (and is already happening in a lot of cases).
| neogodless wrote:
| I'm not following your chain of reasoning here.
|
| Prices were climbing _before_ the chip shortage, while
| "technology" (or specifically, features requiring computer
| chips) has increasingly been an important part of marketing
| strategy, differentiation and consumer focus in the automotive
| industry. (Anecdotally, I check reviews for how well they
| handle things like Android Auto/Apple CarPlay, and in-car
| software updates.)
|
| The pricing could reflect a lot of things, including inflation,
| growing consumer wealth (or credit), consumers prioritizing
| automotive due to a variety of reasons including
| marketing/image, increased time spent commuting, etc.
|
| What does this supply chain hiccup have to do with your
| hypothesis?
___________________________________________________________________
(page generated 2021-10-01 23:02 UTC)