COVID affecting the Auto industry: Decreased production of F-150 due to semiconductor chip shortage

3 years ago

Share Story

The shortage of semiconductor chips has been affecting the automotive industry. Ford is the latest in the industry to announce cuts in production due to the shortage. The company will decrease the output of its profitable F-150 pickup truck. The truck plants in Michigan and Kansas will see cuts in shifts from 3 to 1 and from 3 to 2, respectively. According to CNBC, an emailed statement from Kelli Felker, Ford’s spokeswoman states, “We are working closely with suppliers to address potential production constraints tied to the global semiconductor shortage and working to prioritize key vehicle lines for production, making the most of our semiconductor allocation.”

Nissan Motor and Volkswagen had also cut production due to the shortage of the semiconductor chip. The shortage started late last year after an unexpected rebound in the auto industry after shutdowns due to the pandemic. Semiconductors are significant components in new vehicles; they are used in power steering and infotainment systems.

The chips are not used exclusively in the automotive industry; they are a feature of consumer electronics as well. The shortage is affecting other industries. Qualcomm Inc, the world’s largest smartphone chip maker has reported that it is struggling to keep up with demands. Working from home and online schooling increased the needs for computers, while fear of public transportation increased the demand for motor vehicles, these increased the demand for semiconductor chips.

Ford’s president of the Americas and international markets, Kumar Galhotra says that the company has been working to mitigate the challenges, but he expects that the problem will be around for at least the first half of this year.