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article imageAutomakers hit hard by global semiconductor chip shortage

By Karen Graham     Mar 24, 2021 in Business
General Motors extended production cuts in North America on Wednesday due to a worldwide semiconductor chip shortage. Adding to the bad news, it was learned that chip-maker Renesas Electronics may be down for months due to a fire last week.
The global shortage of semiconductor chips, used in everything from various electrical components for cars, to personal electronics, and other equipment has not improved.
However, the global auto sector is being hit especially hard after suppliers directed semiconductors away from the automotive industry as multiple plants shut down last year due to the Covid pandemic.
General Motors' announcement on Wednesday means that its Wentzville, Missouri, assembly plant would be idled during the weeks beginning March 29 and April 5. It will extend downtime at its plant in Lansing, Michigan, which has been idled since March 15, by two weeks.
In a statement, GM spokesman David Barnas said, “GM continues to leverage every available semiconductor to build and ship our most popular and in-demand products, including full-size trucks and SUVs for our customers. We have not taken downtime or reduced shifts at any of our full-size truck plants due to the shortage.”
GM plants in Kansas and Ingersoll, Ontario, that shuttered in early February over the chip shortage are expected to remain closed until at least mid-April.
Renesas Electronics Corporation Nippon Building  Chiyoda-ku  Tokyo.
Renesas Electronics Corporation Nippon Building, Chiyoda-ku, Tokyo.
Vehicles affected by the GM production cuts include the mid-sized pickup trucks, the Chevrolet Colorado and GMC Canyon in Missouri, and the Cadillac CT4 and CT5 and Chevy Camaro cars in Michigan.
General Motors is not alone in extending production cuts at plants in North America. Ford Motors on Wednesday said it would cut output this week of the Transit van at its Kansas City, Missouri, assembly plant due to the shortage. Production of the flagship F-150 pickup at the plant is not affected.
On Tuesday, Japanese automaker Honda Motor Co said it was further cutting North American production due to a chip shortage. Hyundai Motor Co, until recently one of the automakers least affected due to prudent stockpiling, is facing curbs to production from April, the Financial Times reported on Wednesday, citing a person with direct knowledge of the situation.
Making the chip shortage even worse is the fire last week at a factory owned by a subsidiary of Renesas Electronics Corp. in Hitachinaka, northeast of Tokyo, Japan, according to the Washington Post.
Renesas said heat from an electrical problem inside a single piece of equipment caused the fire and contaminated clean rooms needed to make semiconductors. It said two-thirds of the chips made at the fire-affected factory were automotive chips.
According to the consulting firm AlixPartners, it is estimated that the chip shortage will cut $60.6 billion in revenue from the global automotive industry this year.
More about semiconductor chips, Automakers, production cuts, Nort America, Renesas Electronics Corp
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