GM, Ford stops some production due to chip shortage Worsens – CBS Detroit

DETROIT (AP) – The global shortage of computer chips is getting worse, forcing carmakers to temporarily close factories, including those building popular pickup trucks.

General Motors announced Thursday that it would halt production at eight North American factories over the next two weeks, including two making the company’s best-selling Chevrolet Silverado pickup.

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Ford will stop picking up at its Kansas City Assembly Plant for the next two weeks. Shifts will be cut off at two more truck factories in Dearborn, Michigan and Louisville, Kentucky.

The cuts will exacerbate an already shortage of cars, trucks and SUVs at nationwide dealerships that have pushed prices to record levels. Automakers reported that U.S. dealers had just under a million new cars on their lots in August, 72% lower than the 3.58 million in August 2019.

“It now appears to be accelerating in the wrong direction,” said Jeff Schuster, president of global vehicle forecasting for LMC Automotive, a consulting firm.

Industry analysts say the delta variant of the new coronavirus has hit chip factories in Southeast Asia hard, forcing some factories to close. It exacerbated a chip shortage that began to improve earlier in the summer.

“Now the prospect of new sales for the rest of the year continues to dampen with the reality that tight inventory will last well into 2022,” said Kevin Roberts, director of industry insights for Cargurus.com.

Demand for trucks, SUVs and other cars is high, but buyers are growing frustrated due to lack of stock and high prices. Sales of light vehicles in the United States fell nearly 18% in August compared to a year ago, while the average selling price of cars hit over $ 41,000, a record according to JD Power.

Sales of Ford’s F-Series trucks fell nearly 23% for the month.

August’s sales decline and inventory shortages led Schuster to reduce its US sales forecast for the year to DKK 15.7 million. By the time the pandemic hit, sales had run around $ 17 million a year.

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Consumers who need a new vehicle do not have many choices with dealer equipment so short, Schuster said. Some have left the market because they can not find something that meets their needs. For others, “pricing is through the roof, so they can not afford and are not willing to spend what it will cost to get that vehicle.”

GM closes pick-up factories in Fort Wayne, Indiana and Silao, Mexico, for a week from Monday. A plant in Wentzville, Missouri that builds medium-sized pickups and large vans closes in two weeks. Other plants that make small and medium-sized SUVs will be idling for two weeks or longer.

“These recent planning adjustments are driven by the continuing shortage of parts caused by semiconductor supply constraints from international markets experiencing COVID-19-related restrictions,” GM said in a statement.

The GM and Ford cuts come on top of temporary factory closures previously announced by Toyota, Nissan and Stellantis, formerly Fiat Chrysler.

Stellantis closed its Ram factory in Sterling Heights, Michigan this week due to a shortage of chips. The company’s Belvidere, Illinois, small SUV factory and a minivan facility in Windsor, Ontario are down for two weeks.

Toyota said it would reduce production by at least 40% in Japan and North America over the next two months and reduce production by 360,000 vehicles worldwide in September alone.

Nissan, which announced in mid-August that chip shortages would force it to close its huge plant in Smyrna, Tennessee, for two weeks until August 30, now says the closure will last four weeks until September 13. .

There is a little good news. Ford said total production increased by 76% from July to August, although it is not clear how long that would last.

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