Stellantis, Nio cut more production due to chip shortage
Multinational automaker Stellantis NV and Chinese electric vehicle maker Nio became the latest to announce new production cuts as a result of a global chip shortage.
Stellantis has said it will temporarily halt production at five North American plants next week because of the global microchip shortage: two assembly plants in Canada, one in Mexico and two in the United States. The production halts will start next week through early to mid-April.
The plants affected are the company’s Toluca, Mexico, facility, where it produces the Jeep Compass; Windsor Assembly in Ontario where it builds Chrysler Pacifica minivans; a plant in Illinois that builds the Jeep Cherokee SUV; a Michigan plant that builds the Ram 1500 Classic pickup and another Ontario plant that builds the Chrysler 300, Dodge Charger and Dodge Challenger.
Stellantis did not specify how long the shutdowns would last, but a local union in Windsor said the minivan plant would halt production for four weeks starting today.
Nissan Motor Co has said it will halt production for two days from April 1 at its Smyrna Vehicle and Canton Vehicle Assembly Plants and Mexico Aguascalientes plant. Normal output will resume on April 6.
Nio, one of the main challengers to Tesla, which dominates the electric vehicle market in China, said it would halt production for five working days at its Hefei, Anhui Province, plant and cut its first-quarter delivery forecast by as much as 1,000 vehicles.
Shares of Nio, which makes the ES8 and ES6 electric sport-utility vehicles, ended Friday down 4.8 percent on the New York Stock Exchange.
Nio, which also faces competition from homegrown rivals such as Xpeng Inc, now expects to deliver 19,500 vehicles in the first quarter, down from 20,000-20,500 previously.
Ford Motor, Honda Motor, General Motors and Volkswagen were among the automakers caught off guard by the shortage, forcing many to hold back production even as car demand picked up during the pandemic.
Chip shortages have cost the auto industry 130,000 units in lost production, research firm AutoForecast Solutions estimates, with the heaviest impact in North America, with 74,000 vehicles lost.
The chip scarcity is also a result of an increased demand from the consumer electronics industry as people worked from home and played more video games during the crisis. Sanctions against Chinese technology companies have also played a role.
Ford had warned the shortage could hit its 2021 profit by up to US$2.5 billion, while larger US automaker GM expects the crisis to shave up to US$2 billion off its full-year profit.