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The global chip shortage is slamming the auto industry

Yahoo Finance's Dan Howley discusses how the global chip shortage is slamming the auto and gaming industries.

Video Transcript

ADAM SHAPIRO: But we want to get straight to Dan Howley because we were telling you about the chip shortage impacting the auto world, also impacting the gaming world. How appropriate since we just got Take-Two Interactive. But what can you tell us, Dan?

DAN HOWLEY: Yeah, so obviously we've had a lot of discussions lately about the chip industry and how the ability to fabricate chips has been kind of hamstrung as a result of the pandemic and the increased desire for chips from a variety of different places. Now we're starting to learn more about how that's impacting the game industry. And so we have the two new consoles that are available. There's the Sony Playstation 5-- there's two versions of that-- and Microsoft's new Xbox Series X. There's also the series S. And they're being hit hard because they simply don't have enough silicon chips to go around for these devices to keep up with demand.

So not only are there issues with actually getting these delivered to people as a result of bots being used by resellers to scoop them up and then sell them at astronomically high prices-- which is pretty unfair-- but the actual chips are available to make these fast enough for people to want them. And so some of the experts that I've spoken to have said that you would be lucky to get one of these before halfway into 2021. At that point, we might start to see some of these devices start to open up as far as availability. But until then, getting them is still going to be a real slog.

And Sony said that they sold I believe was 4.5 million Playstation 5 devices already in their previous quarter. And this just speaks to the popularity of these systems. It does though leave a sour taste in gamers' mouths because they want these systems, they've been marketed for so long, and yet when it comes time for the companies to actually release them, they're not there for them to purchase.

SEANA SMITH: Hey, Dan, when it comes to supply and demand problem, this imbalance that we're seeing, any idea just in terms-- I know you're saying that some of these products won't be delivered now for quite some time. But when do we expect, when we step back and take a look at this larger issue, when is this expected to be corrected and what needs to happen in order for it to be corrected?

DAN HOWLEY: For the overall chip industry, it really just comes to the fact that the demand is so much higher than supply at this point. And the ability for these plants to put out different wafers of different needs just isn't there at the moment. So once we start to see people scale back what they want as far as-- we're talking about auto chips, we're talking about PC chips, we're talking about different things along those lines. Once we start to see demand scale back, then we'll be able to have these companies catch up and have their devices available, have the chips available for the devices that need them.

So it's going to be quite a bit of time, still, I believe. But like I said, as far as the gaming consoles go, it'll be probably in the middle of 2021 that they'll start to see full availability, when you'll be able to walk into a Best Buy or go to Amazon and order them and actually get them.

ADAM SHAPIRO: Dan Howley, thank you very much.