SEAT to extend production cut in Spain into 2022 due to chip shortage

Volkswagen’s Spanish unit SEAT prepares to increase partial car assembly suspensions at its plants near Barcelona well into 2022 as the global semiconductor supply crisis continues, the automaker said in a statement.

“The deterioration in the supply of semiconductors now requires reorganizing, planning, and adopting new labor protocols,” SEAT said, adding it had started negotiating a furlough plan with regional unions to cancel some working shifts between September 27 and June 30, 2022.

The chip supply disruptions emerged as demand for the SEAT and CUPRA brands is back at pre-coronavirus crisis levels, Xavier Ros, the company’s vice president for human resources, said.

The chip shortage, which has hit automakers worldwide, emerges from a confluence of factors as automakers, which closed plants for two months during the coronavirus pandemic last year, rival against the sprawling consumer electronics industry for chip supplies. A factory fire suffered by Japanese chipmaker Renesas this year is also cited as a reason behind the chip shortage.