GM extends plant shutdowns at three plants due to chip shortages

General Motors is extending temporary shutdowns at three assembly plants until mid-March due to the global shortage of semiconductor chips.

The affected plants are in Kansas; Ontario, Canada; and San Luis Potosí, Mexico. They produce the Chevrolet Malibu sedan and the Buick Encore, Cadillac XT4, GMC Terrain and Chevy Equinox and Trax crossovers.

The shutdowns, which initially were supposed to last until this week, will be reassessed in mid-March. The goal is to ensure that the company has enough semiconductor chips to produce its most profitable SUVs and SUVs.

“Semiconductor supply remains an issue facing the entire industry,” GM said in a statement. “GM’s plan is to take advantage of all available semiconductors to build and ship our most popular and in-demand products, including large trucks and SUVs and Corvettes to our customers.”

Cox Automotive says GM’s supplies for Malibu and crossovers are greater than what the industry normally considers “healthy”, meaning the automaker can cut production at its plants.

Semiconductors are extremely important components of new vehicles for areas ranging from information and entertainment systems to more traditional parts, such as power steering. They are also used in consumer electronics.

Automakers and parts suppliers began to warn of a semiconductor shortage at the end of last year, after vehicle demand rebounded stronger than expected after a two-month factory shutdown last spring due to the coronavirus pandemic. .

Ford Motor this week was forced to cut production on its highly profitable F-150 pickup trucks due to a lack of chips. The company said it was unable to prioritize the production of the pickups because they use exclusive chips compared to other models.

Ford said last week that the shortage could cut its earnings by $ 1 billion to $ 2.5 billion this year.