A General Motors employee works on December 13, 2019 at the automaker’s plant in Wentzville, Missouri.
Photo by Melissa Vaeth for General Motors
General Motors will suspend production of its medium-sized vans due to the global shortage of semiconductor chips. It is the last stop, as the car manufacturer prioritises the production of its larger and more cost-effective pickups and SUVs.
Downtime at the Missouri plant will begin Monday and run through April 12, according to a message to employees of local union United Auto Workers. Produces GMC Canyon and Chevrolet Colorado pickups. According to GM, the production of vans at the facility will not be affected.
GM will also advance the planned downtime for the two-week plant from May 24 to July 19 to “allow more time to build the product” during the second half of the year, the union said. GM spokesman David Barnas confirmed the plans.
In addition to the pickups, Barnas said GM will extend downtime at a car plant in mid-Michigan for two weeks in mid-April. GM has temporarily shut down or cut production at several plants that produce cars or crossovers to prioritize production of its full-size pickups and SUVs.
“GM continues to leverage all available semiconductors to build and ship our most popular and in-demand products, including full-size trucks and SUVs to our customers,” it said in an emailed statement. “We haven’t taken downtime or reduced changes to any of our full-size truck plants due to shortages.”
Transgenic plants in Kansas and Ingersoll, Ontario, which closed in early February due to a shortage of chips, are expected to remain closed at least until mid-April. GMO plants in Brazil and South Korea have also been affected by the shortage. A plant in Mexico is expected to reopen on April 5 after being closed since February 8.
GM’s actions are the latest as the automotive industry tries to address global chip shortages after suppliers steered chips toward the automotive industry during rolling plant shutdowns. last spring because of Covid. Consulting firm AlixPartners estimates that the lack of shavings will reduce the global automobile industry’s revenue by $ 60.6 billion.
Semiconductor chips are extremely important components of new vehicles for entertainment systems, power steering and brakes, among other systems. The pieces can contain various sizes and different types of chips.
GM expects chip shortages to reduce $ 1.5 billion to $ 2.5 billion of its free cash flow by 2021.