Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Ford is the latest auto company to halt production amid scarcity of semiconductors. Nissan, Toyota, Volkswagen, Honda and Fiat Chrysler have all cut production of some vehicles owing to a dearth of semiconductors or chips in the global market amid tight supply from China. 


Ford shut its Kentucky plant for a week, and said it will also shut its Brazil plant and stop producing automobiles in the country. Production will be stopped immediately amid the COVID-19 pandemic which seems to get worse and has significantly lowered sales causing major losses to the company. 


Honda Motor said that their output in Japan maybe cut owing to the chip crunch. Fiat has temporarily shut production at its Mexico and Canada plants. Nissan has also cut production at its Oppama plant in Japan.


In India, Mahindra & Mahindra, Bosch and other major auto manufacturers have acknowledged that the shortages of the chips is likely to affect production going ahead. 


Volkswagen Group and Continental Auto Parts has also indicated that a shortage of electronic chips will hamper production of vehicles. 


With the spread of the pandemic, there is a huge demand for semiconductors in the consumer electronics and 5G connectivity sector, which has eventually led to lower supplies to the auto industry. Most new car models have features like Bluetooth connectivity, driver assists and navigations devices, which are enabled by semiconductors. 

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