Major Japan-based semiconductor manufacturer Renesas expects semiconductor shortages for the automotive industry to continue until the middle of next year, says company chief executive Hidetoshi Shibata.

Renesas returned to full production in July following its plant fire in March.

“We expect to compensate for the lost production volumes due to the fire by the end of the year,” Shibara said during an online press conference. “However, automakers, which have cut their production this year due to a shortage of semiconductors, will try to catch up next year, which will keep the increased demand for chips. We believe that demand will only come into equilibrium with supply by the middle of next year.”

Renesas reported an increase of 115% on-year in operating profit to $600 million in January-June. Product sales increased by 22%.

In 2019, Renesas was the third-largest maker of automotive chips. Toyota, Nissan and Honda are among its biggest customers.

Global automotive production could rebound 7-9% on-year in 2021 but will be hampered by supply chain frictions, mainly the lack of semiconductors for OEMs, ING Bank said last week.

The global semiconductor shortage has even affected next year’s production already, with 5 million vehicles estimated not produced in 2021 and 3m units in 2022, the bank says citing the Center for Automotive Research. The battle for chips will continue between the automotive industry, consumer electronics, computing and wireless communication.

Bosch recently opened a €1 billion ($1.21 billion) semiconductor manufacturing facility in Dresden, Germany. This is expected to significantly ease automotive chip supply shortages, but only from September.