Ford outlines additional manufacturing cuts resulting from international chip scarcity By Reuters

2/2 © Reuters. FILE PHOTO: A brand of Ford is pictured on a automobile at an occasion in Switzerland 2/2 By Ben Klayman DETROIT (Reuters) -Ford Motor Co on Wednesday outlined one other sequence of plant shutdowns as a result of international semiconductor chip scarcity, with 5 services in the US and one in Turkey


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© Reuters. FILE PHOTO: A brand of Ford is pictured on a automobile at an occasion in Switzerland

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By Ben Klayman

DETROIT (Reuters) -Ford Motor Co on Wednesday outlined one other sequence of plant shutdowns as a result of international semiconductor chip scarcity, with 5 services in the US and one in Turkey affected.

The No. 2 U.S. automaker didn’t define what number of autos can be misplaced within the newest actions, and reiterated it intends to offer an replace on the monetary influence of the chip scarcity with its quarterly earnings on April 28, suggesting the hit could possibly be greater than initially forecast.

Ford stated in March it anticipated the semiconductor scarcity to value between $1 billion and $2.5 billion. Whereas the corporate has prioritized chips for its highest-profit autos, it has been pressured at occasions to idle manufacturing of its top-selling F-150 full-size pickup, and it has parked a few of these vans for ultimate meeting later when sufficient chips are in hand.

The Dearborn, Michigan-based firm this month introduced manufacturing cuts through the weeks of April 19 and 26 at vegetation in Chicago, Flat Rock, Michigan, and Kansas Metropolis, in addition to implementing a diminished schedule at its Ohio Meeting Plant, the most recent in a string of chip-related curtailments.

It additionally set downtime for its Louisville, Kentucky, truck plant the weeks of April 26 and Could 3, and its van plant in Golcuk, Turkey, from Could 8 to Could 31. Nonetheless, Ford hopes to offset a few of the losses in Turkey by pulling ahead downtime scheduled later within the yr.

Semiconductors are used extensively in vehicles, together with to observe engine efficiency, handle steering or automated home windows, and in sensors utilized in parking and leisure methods.

Ford stated along with the chip scarcity, different components driving the shutdowns included the beforehand reported fireplace at Renesas Electronics Corp’s chip-making manufacturing facility in Japan and prior extreme winter storms in Texas.

Trade analysis agency AutoForecast Options estimated misplaced manufacturing of virtually 408,000 autos for Ford as a result of scarcity, with Wednesday’s actions accounting for greater than 91,300 of that complete.

Additionally on Wednesday, Japan’s Honda Motor Co stated it could reduce manufacturing at a few of its North American vegetation the week of April 19 as a result of chip scarcity and different components, calling the state of affairs “fluid.” German automaker Volkswagen AG (OTC:) idled manufacturing of its Tiguan crossover car at its Puebla, Mexico, plant on Wednesday and Thursday.

Trade officers have beforehand stated the scarcity can be worse within the second quarter than the primary. Ford’s bigger U.S. rival, Common Motors Co (NYSE:), beforehand stated it anticipated the monetary influence of the chip scarcity to shave as a lot as $2 billion from revenue.

It was not clear if chip provides will get better within the third quarter and whether or not automakers could make up all of the misplaced manufacturing later this yr.

Many North American automakers canceled chip orders after vegetation had been shut for 2 months through the COVID-19 pandemic final yr, whereas demand surged from the patron electronics business as folks labored from residence and performed video video games.

That has now left carmakers competing for chips.

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