Global semiconductor shortage causes Ford and Nissan to cut vehicle production

A Ford Escape sports activities utility vehicle (SUV) undergoes remaining inspection throughout production on the Ford Motor Co. meeting plant in Louisville, Kentucky, U.S., on Tuesday, April 28, 2015.

Luke Sharrett | Bloomberg | Getty Images

Ford Motor and Nissan Motor on Friday confirmed they’re chopping vehicle production at vegetation within the U.S. and Japan due to a shortage of semiconductors, highlighting a rising concern for the worldwide automotive business in 2021.

Ford will idle an SUV plant in Kentucky subsequent week, whereas Nissan is decreasing production at a plant in Japan. Both firms mentioned they’re working carefully with suppliers to resolve and monitor the state of affairs for any further impacts.

Automakers and components suppliers started warning of a semiconductor shortage late final 12 months after demand for automobiles was increasing sooner than anticipated following a two-month shutdown of production vegetation due to the coronavirus pandemic.

Semiconductors are extraordinarily vital elements of latest automobiles for every part from infotainment methods to different extra conventional components similar to energy steering. They’re additionally readily utilized in shopper electronics.

German automaker Volkswagen final month mentioned it adjusted production at services in China, North America and Europe due to a shortage within the provide of semiconductors, in accordance to Reuters. America’s largest automaker, General Motors, has not had to cut output however the firm is carefully monitoring the state of affairs, in accordance to spokesman David Barnas.

“We are aware of the increased demand for semiconductor microchips as the auto industry continues its global recovery,” he mentioned in an emailed assertion. “Our supply chain organization is working closely with our supply base to find solutions for our suppliers’ semiconductor requirements and to mitigate impacts on GM production.”

Ford’s impacted plant, the Louisville Assembly Plant, builds the Ford Escape and Lincoln Corsair SUVs, and employs about 3,900 hourly employees. It will transfer up a beforehand deliberate weeklong shutdown later within the 12 months to subsequent week due to the shortage, in accordance to Ford spokeswoman Kelli Felker.

“We are working closely with suppliers to address potential production constraints tied to the global semiconductor shortage,” she mentioned in an emailed assertion.

The affected Nissan facility, the Oppama Plant in Japan, builds the Note, a subcompact automotive that is not offered within the U.S. Lloryn Love-Carter, a Nissan spokeswoman within the U.S., mentioned the corporate’s home production has not been impacted by the semiconductor shortage.

“We are working closely with our supplier partners to monitor the situation and assess any potential impact on our North America operations,” she mentioned in an emailed assertion.

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