Chip shortage forces Ford, Toyota, Nissan, FCA to cut car production

Ford Motor, Toyota Motor, Fiat Chrysler Automobiles (FCA), and Nissan Motor said on Friday they would slash vehicle production this month because of the shortage of semiconductors, becoming the recent automakers hit by a chip crunch as demand recovers from the coronavirus crisis.

Honda Motor also said Friday its output in Japan could be affected by a shortage of semiconductors.

Automakers and electronic makers are dealing with a global shortage of chips as consumer demand has been recovering back from the coronavirus pandemic, causing manufacturing delays.

Major auto chip providers such as NXP Semiconductor said auto production rebounded faster than expected from the coronavirus crisis, leaving them struggling to catch up.

On the other hand, chip manufacturing capacity has been stretched thin worldwide as laptops fly off shelves for working from home, and PCs and gaming consoles sell heavily, leading chip companies such as Nvidia to warn of supply constraints.

And a move by U.S. regulators to blacklist China’s Semiconductor Manufacturing International, has also led chip firms around the world to find new partners.

Ford Motor said it would idle its Louisville, Kentucky, assembly plant, which builds the Ford Escape and Lincoln Corsair SUVs, pulling before a scheduled week-off from later in the year.

Fiat Chrysler said it will delay the resuming the production at its Toluca, Mexico plant, where it builds the Jeep Compass, and idle its Brampton, Ontario factory that builds the Chrysler 300, Dodge Charger and Dodge Challenger cars.

The Mexican plant had been set to resume production this week, but now both plants will be shut through the end of the month, FCA said.

Toyota will slash production of its Tundra full-size pickup truck at its San Antonio, Texas, plant, but spokesman Scott Vazin did not immediately know how many units are going to be lost. “We’ll throttle back production,” he said, adding no other U.S. vehicles were affected.

Nissan said it planned to decrease the production of the Note, a hybrid electric car, at its Oppama Plant in Kanagawa prefecture, Japan but did not provide details of the scale of the output cut.

The Nikkei newspaper reported that Nissan would reduce its Note production at Oppama to about 5,000 units in January, from an initially planned 15,000 units.

Not all automakers are going through this situation. General Motors and BMW AG said on Friday that they have not been affected by the chip shortage as of yet.