Computer chip shortage continues to plague the Big Three, auto industry

Chip shortage causes issues for automotive industry

Computer chip shortage continues to plague auto industry

DETROIT – The semiconductor shortage that has hampered the auto industry, created vehicle shortages and higher prices isn’t likely to end any time soon.

Toyota, the world’s largest automaker, has cut its global production 40%.

According to Mark Fulthorpe, with IHS Markit Production Forecasting, the manufacturing of the semiconductors had stalled, but now the testing and shipping of the chips is the current issue,.

“We’re seeing a spill over in Malaysia production at the moment, where we’re seeing COVID cases returning that is disrupting another part of the supply chain,” Fulthorpe said.

Malaysia shut down for two months and manufacturers only went back to work this week.

“COVID-19 was 2020′s problem and semiconductors were 2021′s problem,” Fulthorpe said. “I think the recent evidence proves the two are intrinsically linked.”

Domestic automakers have adjusted staffing production.

GM will close the Orion Assembly Plant. The Lansing Grand River SUV plant was supposed to open before Labor Day, now it won’t. The Cadillac production that has been down since May will not return until mid-September.

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Ford will take down production at its Kansas City F-150 plant. Its Dearborn Assembly is running and helping with tight supplies.

The shortage of chips and vehicles is expected to last into the second quarter of 2022. Fulthorpe said the industry won’t recover until the pandemic ends.

More: Automotive

About the Authors:

Rod Meloni is an Emmy Award-winning Business Editor on Local 4 News and a Certified Financial Planner™ Professional.

Dane is a producer and media enthusiast. He previously worked freelance video production and writing jobs in Michigan, Georgia and Massachusetts. Dane graduated from the Specs Howard School of Media Arts.