Global chip shortages pushes GM to extend production cuts

General Motors EV

General Motors Co said on Tuesday it was extending production cuts at three global plants through at least mid-March and building but leaving incomplete vehicles at two other factories due to the global semiconductor chip shortage.

GM did not disclose how much volume it would lose in its latest action or which supplier and vehicle parts were affected by the chip shortage.

GM said its focus remains on keeping production running at plants building its highest-profit vehicles – full-size pickup trucks and SUVs. GM also said it intends to make up as much lost production as possible.

GM said it was extending downtime at its plants in Fairfax, Kansas; Ingersoll, Ontario; and San Luis Petosi, Mexico through mid-March, when it will reassess the situation, he said. In addition, GM will build but leave incomplete for later final assembly vehicles at plants in Wentzville, Missouri, and Ramos Arizpe, Mexico.

GM vehicles affected by the idled plants include the Chevrolet Malibu sedan, Cadillac XT4 SUV, Chevy Equinox, and GMC Terrain SUVs, while the vehicles built for later final assembly include the Chevy Colorado and GMC Canyon pickups and Chevy Blazer SUV.

The chip shortage has affected many automakers, including Toyota Motor Corp, Volkswagen AG, Stellantis, Ford Motor Co, Renault, Subaru Corp, Nissan Motor Co, Honda Motor Co and Mazda Motor Corp.

Asian chipmakers are rushing to boost production, but warn the supply gap will take many months to plug. German chipmaker Infineon warned things will get worse in the near term.

The chip shortage is expected to cut global vehicle output in the first quarter by more than 670,000 vehicles and last into the third quarter, forecasting firm IHS Markit said. AutoForecast Solutions estimated total lost production this year could approach 1 million vehicles.

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