Ford Extends North American Plant Shutdown by 2 Weeks Due to "Vehicle Semiconductor Shortage"

Prolonged Semiconductor Shortage as a Last Resort
Concerns Over Worsening Q1 Earnings and Expanding Damage

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Hyunwoo Lee] Ford, a leading American automaker, announced that it will extend the closure of some of its North American plants due to the worsening shortage of semiconductor components. The ongoing shortage of automotive semiconductors has inevitably led to an extension of the production halt period. Concerns are growing that the scale of damage to major automakers, including Ford, could increase further.

According to foreign media such as The Wall Street Journal (WSJ) on the 21st (local time), Ford stated that it plans to extend the suspension of operations at five North American plants due to the deepening shortage of automotive semiconductor parts. Ford announced that it will extend the closure of plants located in Chicago, Detroit, and Kansas by two weeks, continuing until May 14. The production line for sport utility vehicles (SUVs) in Ontario, Canada, will also be shut down for an additional week until early May. WSJ reported that the reduction in production of Ford’s popular model, the F-150, is also expected to continue.

Earlier, the truck production plant near Ford’s headquarters in Detroit resumed operations on the 19th after a two-week shutdown. However, another truck plant in Kansas City halted operations last week and plans to remain closed until May 10. Since the beginning of this year, global automakers have frequently suspended plant operations and adjusted production schedules due to the worldwide semiconductor shortage. This is to prepare for the possibility that even chips used in core vehicles, such as large SUVs which are best-selling and highly profitable, might run out.

In February, Ford projected that its operating profit could decrease by $1 billion to $2.5 billion this year due to disruptions in plant operations caused by the chip shortage. Ford is scheduled to report its first-quarter earnings next week and provide an update on the semiconductor shortage situation. It is known that there are concerns about worsening earnings and expanding damage.

This content was produced with the assistance of AI translation services.