As Chip Shortage Worsens, Ford Decides To Close Plant In Germany For 1 Month

Automakers were expecting some shortage as a result of the global coronavirus pandemic but it’s certain that not at this point in time. But carmakers are now facing a shortage of computer chips because of the massive demand worldwide. Following this, Ford has halted production at one of its German plants. The shortage of chips is making the recovery of automakers from the pandemic tougher. The US automaker said that its factory in Saarlouis, Germany will remain inactive till February 19 over weak demand as well as the shortage of chips. This German plant of Ford makes its most popular four-wheelers in Europe – the Focus – and around 5,000 workers are employed here.

“The situation is being closely monitored. We are adjusting production schedules to minimize the effect on customers, employees, suppliers, and dealers in Europe,” a spokesperson of the company said. The spokesperson said that Ford is not anticipating such a situation at other facilities in Europe. Last week, the carmaker was forced to shut an SUV plant in Louisville, Kentucky. The decision was taken because of the shortage of semiconductors. But the decision of shutting down a plant in Germany hints towards that bigger problem about the shortage of chips. The situation is expected to get worse and it could affect a large number of automakers around the world.

Automakers are still short of chips and the struggle is likely to continue for some time as supplies remain tight. Some of the leading semiconductor manufacturers got a revised list of requirements after sales of cars nosedived following the outbreak of the coronavirus pandemic. Experts believe that the shortage of chips comes at a very crucial time as they suffered a huge loss recently. Despite all this, automakers are under pressure to invest heavily in electric vehicles. Several carmakers have said that they will reduce the number of cars produced from their plant following the shortage of chips.