Yahoo Finanza Chip Shortage Forces General Motors To Cut North American Vehicle Production Again
General Motors has been in a tight spot in recent months due to a shortage of chips, and the company has now been forced to make another tough decision regarding its operations in North America.
General Motors Reduces North American Vehicle Production
General Motors announced earlier on Thursday that it has significantly cut its vehicle production in North America. A shortage in chips is the major reason why the automobile manufacturer is making this decision.
According to The New York Times, the vehicle manufacturer is extending downtimes at eight of its manufacturing plants in the United States. The company said, “These most recent scheduling adjustments are being driven by the continued parts shortages caused by semiconductor supply constraints from international markets experiencing Covid-19-related restrictions.”
General Motors said it would idle six plans in the region for two weeks in September and two more plans for a week each. The company complained that a global shortage of computer chips is the main reason why these plants would remain idle for most of the month.
The shortage in computer chips had gone on longer than vehicle manufacturers had expected. General Motors and the other leading auto manufacturers had expected the chip shortage to end by the end of the second quarter. However, we are deep into the third quarter, and the situation is no close to ending.
Ford is another company that had been affected by the chip shortage. The company reported a decline in sales in August compared to the same month last year due to the shortage of the chips. Other leading vehicle manufacturers affected by the situation include Chevrolet and GMC. Chevrolet was forced to cut back production of its midsize pickups, vans, and Trailblazer.
GM’s Stock Price Slightly Up Despite The Disappointing News
The shares of General Motors are trading in the green zone despite the statement by the company earlier today. GM is trading at $49.34 per share, up by 0.48% since the market opened a few hours ago.
Year-to-date, GM is up by more than 20%. GM began 2021 trading at $40 per share but has now rallied and is trading close to $50.
This article was originally posted on FX Empire
