As demand for consumer electronics skyrocketed during the pandemic, the end result is not just sunshine and rainbows on both sides. This wave of unimaginable proportions pushed the supply chain dangerously close to the breaking point. On a more local level, this has led to production stoppages at many GM plants in North America.
Following the pattern of widespread downtime, General Motors recently announced that it will stop production at a plant in Lansing, Michigan, – a result of the continuing shortage of semiconductors. The factory employs 1,400 workers in charge of producing the Chevrolet Camaro, Cadillac CT4 and Cadillac CT5.
“We continue to work closely with our supply base to find solutions to our suppliers’ semiconductor requirements and to mitigate the impact on GM,” said spokesman Daniel Flores.
Unfortunately, the problem leaves several other factories in North America affected – including three other locations that have been forced to put production on the back burner. Outside the United States, GM’s facilities in Canada, Brazil and Mexico are experiencing similar difficulties. It is unclear when operations in the United States will resume, but we know that the San Luis Potosi assembly plant – shut down since February 8 – is due to kick off on April 5.
Along with the tax this will represent for economic security and the employment of existing workers, GM itself is also facing substantial difficulties. It is estimated that scarcity and subsequent stoppages can lead to the loss of around 216,000 vehicles. To offer some perspective, that means approximately $ 2 billion in earnings that are gone.
We would be remiss not to mention that Toyota and Hyundai have successfully predicted shortages and stocked the necessary components in anticipation of that eventuality. Nevertheless, it remains an uphill battle, as computer chips are expected to remain in short supply until the second half of this year.