A Ford Escape (SUV) sports utility vehicle is subject to final inspection during production at the Ford Motor Co. assembly plant. from Louisville, Kentucky, USA, Tuesday, April 28, 2015.
Luke Sharrett | Bloomberg | Getty Images
Ford Motor and Nissan Motor confirmed on Friday that they are reducing vehicle production at factories in the US and Japan due to a lack of semiconductors, highlighting a growing concern for the global car industry in 2021.
Ford will move an SUV plant to Kentucky next week, while Nissan will reduce production to a plant in Japan. Both companies said they are working closely with suppliers to resolve and monitor the situation for any additional impact.
Automakers and parts suppliers began warning of a shortage of semiconductors late last year, as vehicle demand grew faster than expected after a two-month shutdown of production plants due to the pandemic of coronavirus.
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 easy to use in consumer electronics.
German carmaker Volkswagen said last month it had adjusted production to facilities in China, North America and Europe due to a lack of semiconductor supplies, according to Reuters. America’s largest automaker, General Motors, has not had to cut production, but the company is closely monitoring the situation, according to spokesman David Barnas.
“We are aware of the growing demand for semiconductor microchips as the automotive industry continues its global recovery,” he said in an emailed statement. “Our supply chain organization works closely with our supply base to find solutions to the requirements of our semiconductor suppliers and to mitigate the impact on GM production.”
Ford’s affected plant, the Louisville Assembly Plant, builds the Ford Escape and Lincoln Corsair SUVs and employs about 3,900 workers an hour. According to Ford spokesman Kelli Felker, there will be an increase in a previously planned shutdown weekly later in the year until next week due to shortages.
“We are working closely with suppliers to address potential production constraints related to the global shortage of semiconductors,” she said in an e-mailed statement.
The affected Nissan plant, Japan’s Oppama plant, is building Notes, a subcompact car that is not sold in the US Lloryn Love-Carter, a Nissan spokeswoman in the US, said the company’s domestic production was not affected by the lack of semiconductors.
“We work closely with our supplier partners to monitor the situation and assess any potential impact on our North American operations,” she said in an email.