The ongoing global shortage of computer chips is continuing to affect vehicle manufacturers. Ford and General Motors have cut production at several facilities in North America.
This shortage has been impacting several consumer markets since last summer. Production of computers, phones, game consoles and newer model vehicles with many digital features has been cut short as a result. The Suez Canal blockage in March has also recently contributed to this issue - chips being brought from Asia to Europe were held up by the grounded cargo ship.
The auto industry has begun to truly feel the effect of the shortage. In January 2020, the U.S. had enough vehicles to supply 77 days worth of demand. As of this February, that figure went down to 55 days.
GM'S production plant in Spring Hill, Tennessee has shut down this week - Cadillac XT5, XT6 and GMC Acadia SUVs are manufactured here. Their Ontario and Kansas plants have been shuttered since Feb. 8.
Ford shut down three plants this week, where Ford Explorers, Mustangs and Lincoln Aviator SUVs are manufactured. They plan for seven of their plants to run through late June to early July, over two weeks which are usually designated as a summer break in production.
The shortage and lack of production of certain vehicles will inevitably affect sales this year in the vehicle industry overall. GM and Ford are expecting to lose up to $2 billion in pretax profits by the end of this year.
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