GM to Halt Production at Several North American Plants Due to Chip Shortage -- 3rd Update
By Mike Colias and Allison Prang
General Motors Co. will halt production at several North
American factories and extend shutdowns at some others because of a
protracted shortage of semiconductor chips that is disrupting the
auto industry's hopes for a bounceback this year.
The auto maker said Thursday that three plants previously
unaffected by the chip shortage will be idled or have output
reduced for one or two weeks, including a factory in Tennessee and
another in Michigan that make popular midsize sport-utility
vehicles. Vehicles affected include the Chevrolet Traverse SUV, and
the Cadillac XT5 and XT6 SUVs.
GM also will extend closures of a Kansas City-area factory and a
plant in Ontario until May 10. Both facilities have been closed
since February, as GM diverts chips from less-popular models to
large pickup trucks and SUVs, which are its biggest profit
"GM continues to leverage every available semiconductor to build
and ship our most popular and in-demand products," a company
spokesman said. So far, GM has avoided taking downtime at the four
factories where it makes the company's largest pickup trucks and
SUVs, he said.
Meanwhile, GM said it would resume production April 12 at a
Missouri factory that makes midsize pickup trucks and has been
idled for two weeks due to the chip shortage.
CNBC previously reported GM's production cuts.
Auto makers since late last year have been grappling with a
shortage of semiconductor chips, which go into software modules
used to control everything from brakes to dashboard touch screens.
The companies have been cutting production for months as they
scramble to line up chip supplies, with executives saying the
shortage could last several more months.
Fallout from the chip crunch has worsened in recent weeks in the
U.S. Ford Motor Co. last week said it would deepen production cuts
in North America, including idling for two weeks a factory near its
headquarters in Dearborn, Mich., that makes the F-150 pickup truck,
its biggest moneymaker.
The effect of the bottleneck in semiconductor supply -- output
for which is concentrated in Asia -- has crimped production at
virtually every major car company in recent months, including
Toyota Motor Corp., Volkswagen AG, Honda Motor Co. and Stellantis
President Biden has ordered a supply-chain review and met with a
bipartisan group of lawmakers to address the issue, White House
press secretary Jen Psaki said Thursday. Next week, top
administration officials will meet with chip manufacturers to
discuss what might be done.
"We fully recognize that this is an issue that is impacting
industries across the country, including the auto industry," Ms.
The seeds of the auto industry's chip shortage were planted last
spring, when auto makers and suppliers cut their production
schedules as the pandemic clouded the outlook for vehicle
Meanwhile, chip producers have been scrambling to keep pace with
strong demand from makers of laptops, gaming systems and other
electronic devices that have been in high demand, curbing the
supply of automotive chips.
New-vehicle demand in the U.S. has snapped back from a pandemic
lull last summer, worsening an inventory crunch at dealerships and
sending car prices higher.
Alex Leary contributed to this article.
Write to Mike Colias at Mike.Colias@wsj.com and Allison Prang at
(END) Dow Jones Newswires
April 08, 2021 14:10 ET (18:10 GMT)
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