Ford Motor Co (NYSE: F) is idling production at the Dearborn, Michigan plant — where it makes the highly profitable F-150 pickup trucks— from Friday to Sunday due to the global semiconductor chip shortage, Reuters reported on Thursday.
What Happened: A global semiconductor chip shortage has forced automakers across the world to delay or cut vehicle productions and are also disrupting global supply chains at a time when economies are reopening after being hit by the pandemic and consumer demand for personal mobility is on the rise.
Ford and other automakers are focusing on building their most profitable vehicles first but a production halt for its full-sized pickups indicates the chip shortage is worsening.
The second-largest U.S. automaker had said last week it would build F-150 trucks and Edge SUVs without certain parts and hold them for a number of weeks until they can be completed and shipped.
Why It Matters: Asian chipmakers are rushing to expand their production capacity to meet a global semiconductor shortage that is hurting carmakers the most even as companies such as Ford, General Motors Co (NYSE: GM), Tesla Inc (NASDAQ: TSLA) Honda Motor Co (NYSE: HMC) and many others have all said they are shutting down certain assembly lines due to the shortages.
Price Action: Shares of Ford closed up 1.5% at $12.32, those of GM up 1.4% at $56.6, Tesla up 1.61% at $640.4 and those of Honda were up o.36% at $30.25, as of Thursday’s close.
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