Tesla CEO Elon Musk stated Friday that the continuing semiconductor disaster might be over by subsequent 12 months.

The tech billionaire stated he thinks chip scarcity is a “short-term” drawback versus a long-term one. 

“There’s a whole lot of chip fabrication vegetation which are being constructed and I feel we may have good capability by subsequent 12 months,” Musk stated at an Italian tech occasion that was streamed on-line Friday.

Musk didn’t specify which chip vegetation he was referring to.

Chip heavyweights Intel and TSMC have introduced plans to construct new vegetation within the U.S. however they will not come on-line for a number of years but.

Glenn O’Donnell, a vp analysis director at advisory agency Forrester, believes the scarcity may final till 2023.

“As a result of demand will stay excessive and provide will stay constrained, we count on this scarcity to final by means of 2022 and into 2023,” he wrote in a blogpost in April.

The worldwide chip scarcity has had a serious influence on a variety of industries, however the automotive sector has been notably badly hit. Large names within the business corresponding to Ford, Volkswagen and Daimler have all been pressured to droop manufacturing at numerous factors and minimize their manufacturing targets on account of an absence of chips.

Through the firm’s first-quarter earnings, Musk stated that Tesla had some provide chain points, earlier than occurring to reference the chip scarcity. 

“This quarter, and I feel we’ll proceed to see that slightly bit in Q2 and Q3, had a number of the most troublesome provide chain challenges that we have ever skilled within the lifetime of Tesla and similar difficulties with provide chain, with components — over the entire vary of components. Clearly, folks have heard concerning the chip scarcity. This can be a enormous drawback.”

Consulting agency AlixPartners predicted this week that the chip scarcity will price the automotive business $210 billion in income this 12 months alone. 

“In fact, everybody had hoped that the chip disaster would have abated extra by now, however unlucky occasions such because the COVID-19 lockdowns in Malaysia and continued issues elsewhere have exacerbated issues,” stated Mark Wakefield, international co-leader of the automotive and industrial follow at AlixPartners, in a press release.

Carmakers use semiconductors in all the things from energy steering and brake sensors, to leisure methods and parking cameras. The smarter vehicles get, the extra chips they use.

In 2019, Tesla began producing vehicles with customized AI chips that assist on-board software program make choices in response to what’s taking place on the street.

Musk stated in July that manufacturing of Tesla’s Powerwall product, a backup battery for the house, was “lagging” on account of the chip scarcity.