A Ford Escape sport utility vehicle (SUV) undergoes final inspection during production at the Ford Motor Co. assembly plant in Louisville, Kentucky, USA, on Tuesday, April 28, 2015.
Luke Sharrett | Bloomberg | Getty Images
Ford Motor and Nissan Motor confirmed on Friday that they are slashing vehicle production at plants in the U.S. and Japan due to a shortage of semiconductors, highlighting a growing concern for the global automotive industry in 2021.
Ford will shut down an SUV plant in Kentucky next week, while Nissan is slowing production at a plant in Japan. Both companies said they are working closely with suppliers to resolve and monitor the situation for any additional impacts.
Carmakers and parts suppliers began to warn of a shortage of semiconductors at the end of last year, after vehicle demand increased faster than expected after a two-month plant shutdown due to the coronavirus pandemic.
Semiconductors are extremely important components of new vehicles for everything from infotainment systems to other more traditional parts, such as power steering. They are also easily used in consumer electronics.
German automaker Volkswagen said last month that it had adjusted production at facilities in China, North America and Europe due to a shortage in the supply of semiconductors, according to Reuters. America’s largest automaker, General Motors, did not have to cut production, but the company is monitoring the situation closely, according to spokesman David Barnas.
“We are aware of the increased demand for semiconductor microchips as the automotive industry continues its global recovery,” he said in an e-mailed statement. “Our supply chain organization is working closely with our supply base to find solutions to our suppliers’ semiconductor requirements and to mitigate impacts on GM production.”
Ford’s impacted plant, the Louisville Assembly Plant, builds the Ford Escape and Lincoln Corsair SUVs, and employs about 3,900 workers per hour. According to Ford spokeswoman Kelli Felker, she will shift the planned shutdown from one week at the end of the year to next week due to the shortage.
“We are working closely with suppliers to address possible production restrictions linked to the global semiconductor shortages,” she said in an e-mailed statement.
Nissan’s affected facility, the Oppama factory in Japan, builds the Note, a subcompact car that is not sold in the U.S. Lloryn Love-Carter, a spokesman for Nissan in the U.S., said the company’s domestic production was not affected by the scarcity of semiconductors.
“We are working closely with our supplier partners to monitor the situation and assess any potential impact on our operations in North America,” she said in an e-mailed statement.