GM shuts down production at three car factories due to chip shortages

The American car manufacturer General Motors has stopped production at three car factories due to shortages of chips. Several car manufacturers, including GM itself, have warned about these problems before. Chip designer Qualcomm also mentions this problem.

A General Motors spokesman told Reuters that the “semiconductor shortage will impact production at GM,” despite the company’s efforts to mitigate the problems. He says chip deliveries to the global auto industry remain very ‘fluid’. In concrete terms, this means that GM has stopped production in three factories. These are factories in the United States, Canada and Mexico. A factory in South Korea is also hit; it will run at half power.

The manufacturer did not say what the exact effects are on production numbers and revenues, or how long these measures will remain in place. GM says it maximizes production at factories that produce vehicles with the highest profit margin. That would mainly concern pickup trucks, SUVs and the Chevrolet Corvette sports car.

Last month, several car manufacturers already expressed the fear that they could make fewer cars due to chip shortages. Nissan and Honda, among others, indicated that they can make fewer copies, because it takes more and more effort to get chips delivered. Volkswagen warned about this before, as did GM. It is unknown what kind of chips are involved.

Taiwanese chipmaker TSMC recently indicated that it is giving the automotive sector a higher priority to address the shortages of chips for cars, although the company admitted that it is mainly about reprioritisation and that capacity cannot be increased just like that. .

The problems are broader and do not only affect the automotive sector. Qualcomm, through recently-appointed CEO Cristiano Amon, said the semiconductor industry deficit is “across the board,” he said in a statement to its quarterly earnings. According to Amon, the industry is currently flooded with orders for chips for computers, cars and many other IoT devices, though he believes the situation will improve later in the year.

The shortages also affect Qualcomm. The outgoing CEO, Steven Mollenkopf, said in the oral statement that his company’s performance and prospects would have been better if supplies had not been so limited, referring to the shortages. Nevertheless, the numbers are very positive. Revenue for the quarter was $8.2 billion, an increase of 62 percent from the same period a year earlier. Profits also grew sharply.

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