DETROIT (Reuters) – General Motors Co. said on Wednesday it would further extend production cuts to three US plants and add a fourth to the list of factories affected by the global shortage of semiconductor chips.
Prolonged cuts do not change GM’s forecasts last month that the shortage could drop to $ 2 billion in profits this year. Subsequently, GM Chief Financial Officer Paul Jacobson said chip supplies should return to normal rates by the second half of the year and was confident profits would not worsen.
The US automaker did not disclose the impact on volumes or say which supplier or parts were affected by the shortage of chips, but said it intends to regain maximum lost production. possible.
“GM continues to leverage all available semiconductors to build and ship our most popular and in-demand products, including full-size trucks and SUVs,” said GM spokesman David Barnas. “We contemplated this time of inactivity when we discussed our prospects for 2021.”
The shortage of chips, which has affected carmakers around the world, stems from the confluence of factors that vehicle manufacturers, which shut down plants for two months during last year’s COVID-19 pandemic, they compete against the consumer electronics industry for chip supplies.
During the pandemic, consumers have been supplied with laptops, game consoles and other electronic products, which has led to a reduced supply of chips. They also bought more cars than industry officials expected last spring, prompting additional supply tensions.
GM said Wednesday it would extend downtime at plants in Fairfax, Kansas and Ingersoll, Ontario, at least in mid-April and in San Luis Potosi, Mexico, until the end of March. In addition, it will leave its Gravatai plant in Sao Paulo, Brazil, in April and May.
The Detroit automaker had previously expanded production cuts to three U.S. plants in mid-March and said vehicles from two other plants would only be partially built. Following Wednesday’s cuts, forecasting company AutoForecast Solutions estimated that GM could lose more than 216,000 units globally due to the shortage.
Ford Motor Co. said last month that the lack of chips could reduce the company’s production by up to 20% in the first quarter and affect profits by up to $ 2.5 billion. He had previously reduced production of his best-selling F-150 van. Stellantis said Wednesday that the shortage of chips could weigh on 2021 results.
Some automakers, including Toyota Motor Corp. and Hyundai Motor Co., avoided deeper cuts by storing chips before the shortage.
Industry officials and politicians have urged the administration of U.S. President Joe Biden to take a more active role in fighting chip shortages.
Last week, Biden said it would seek $ 37 billion in funding to overload chip manufacturing in the United States. An executive order also launched a review of supply chains for such critical products as semiconductor chips, electric vehicle batteries and rare earth minerals.
Last month was a severe winter storm in Texas that killed at least 21 people and caused several chip plants to be shut down. Semiconductor industry officials said customers would face shocking effects in several months.
Report by Ben Klayman in Detroit; edited by Jonathan Oatis and Chizu Nomiyama