DETROIT (AP) – The global shortage of semiconductors for auto parts is forcing major automakers to stop or slow down vehicle production just as they were recovering from pandemic-related factory outages.
Officials at Volkswagen, Ford, Fiat Chrysler, Toyota and Nissan say they have been hit by the shortage and have been forced to delay production of some models to keep other factories running.
“This is absolutely an industry problem,” Toyota spokesman Scott Vazin said in an email Friday. “We are evaluating the supply restriction of semiconductors and developing countermeasures to minimize the impact on production.”
If chip shortages persist, production cuts could reduce the inventory of cars, trucks and SUVs on sale in the United States and other markets. This comes at a time when the industry was just beginning to replenish lost inventories when factories closed last spring to stop the spread of the new coronavirus.
Toyota was forced to halt production of the full-size Tundra collection at a factory in San Antonio, Texas. Ford had scheduled the downtime next week at the assembly plant in Louisville, Kentucky, but has brought it forward to this week. The plant makes the Ford Escape and Lincoln Corsair small SUVs.
Fiat Chrysler has temporarily closed factories in Brampton, Ontario, and a small all-terrain vehicle plant in Toluca, Mexico, while Volkswagen said in December that it was facing a slowdown in production due to shortages. Nissan said it has had to adjust production in Japan, but so far has not seen a significant impact in the United States.
Industry officials say semiconductor companies diverted production to consumer electronics during the worst slowdown in COVID-19 in car sales last spring. Global carmakers were forced to close plants to prevent the virus from spreading. When car manufacturers recovered, there were not enough chips.
“There have been warning signs for months,” said Kristin Dziczek, vice president of industry at the Center for Automotive Research, an industry think tank.
Dziczek spent six to nine months delivering time for the industry to obtain chips through a complex network of suppliers. He said he expects some delivery time to have passed when the problems started popping up a few months ago, which makes it a short-term problem and not a long-term one. “There are still some coming, but not the volumes they thought there would be,” Dziczek said.
In many cases, automakers have stopped making slower-selling vehicles in order to divert chips to the hottest segments of the market, including vans and SUVs.
“This will minimize the impact of the current semiconductor shortage, while ensuring that we maintain production at our other US plants,” Fiat Chrysler said in a statement.
The automotive industry uses more semiconductors than ever before in new vehicles with electronic features such as Bluetooth connectivity and driver assistance, navigation and hybrid electrical systems. Semiconductors are usually silicon chips that perform control and memory functions on products ranging from computers and cell phones to vehicles and microwave ovens.
Car sales fell during the first wave of blockades in April, but have since regained significant ground. New vehicle sales in the United States fell 34% during the first half of last year, but recovered by the end of the year by only 15%.
The shortage of chips needed in increasingly automated cars is the latest example of how the flows and flows of the semiconductor industry can have effects on products.
Last summer school districts struggled to get orders for laptops for students who were still largely attending classes remotely, as personal computer makers had trouble securing processors and other components.
The problems began when overseas chip-producing factories were forced to close in the early stages of the pandemic. The problem was exacerbated last July after the Trump administration imposed sanctions on 11 Chinese companies for alleged labor abuses.
To make matters worse, schools found themselves competing for laptops against deeper pocket companies that also placed large orders for employees while working from home.
The shortage of chips also forced Apple to delay the launch of its latest range of iPhones until late October and early November, more than a month later than when the trend-setting company usually releases the your best-selling device.
The global semiconductor market is expected to be worth about $ 129 billion in 2025, nearly three times its size in 2019, according to research firm Mordor Intelligence. The company lists the major players in the automotive chip market such as STMicroelectronics, Infineon Technologies, NXP Semiconductor, Texas Instruments and Toshiba.
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Liedtke reported from San Ramon, California.