Stellantis sales decline as chip shortage cuts output by 600,000

Stellantis on Thursday reported a 14% decline in third-quarter revenue on a pro-forma basis as the ongoing chip shortages have cut planned quarterly production by 30% or 600,000 vehicles.

In pro-forma basis, the calculation of financial results is made after using certain projections or presumptions.

Chief Financial Officer Richard Palmer said the company was observing a “moderate” improvement in chip supply in October, however, it will remain a concern till the fourth quarter.

This led it to expect a moderate improvement in deliveries in the final part of this year, Palmer said.

The forecast, which was raised in August, assumes no additional decline in semiconductor supply and no upcoming coronavirus-led lockdowns in Europe or the United States.

The automaker’s consolidated shipments declined 27% year on year on a pro-forma basis in the third quarter to 1.13 million vehicles.

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.