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Ford Motor Co said on Wednesday, while announcing the latest North American production cuts at seven assembly plants due to the global chip shortage, that it would provide an update on April 28 on the expected success of its profit 2021.
The U.S. automaker previously said its operating profit this year would be cut from $ 1 billion to $ 2.5 billion. The update to these forecasts will be provided when Ford releases its first quarter results on April 28.
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A Ford spokeswoman declined to comment on how the forecast would change, but Wednesday’s actions include the two-week shutdown of the Ford truck plant in Dearborn, Mich., Where it builds the full F-150 pickup truck. best-selling size. Ford and other automakers have repeatedly stated that they will prioritize producing their vehicles at the highest margin.
Ford previously cut production of the F-150 and in some cases partially built and parked vehicles for final assembly later when enough chips were on hand.
Industry officials told Reuters this week that the chip shortage would be worse in the second quarter than in the first, and it was not clear whether supplies would recover in the third quarter and whether automakers could make up for any production lost later that year.
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“We’re not far out of the woods yet,” said John Bozzella, who heads a major auto trade group. “We don’t know how far that goes. Certainly the second quarter continues to be more difficult than the first, but we’ll have to see how things continue to play out.”
Research firm IHS Markit on Wednesday increased its estimate of the loss in production worldwide.
U.S. rival General Motors Co previously said its 2021 profit could be slashed by as much as $ 2 billion due to the chip shortage.
Earlier Wednesday, GM Chief Financial Officer Paul Jacobson, speaking at a Bank of America conference, said he still feels comfortable with the company’s 2021 profit forecast despite the shortage of chips. GM said in February that, including the chip hit, it expected to earn $ 4.50 to $ 5.25 per share this year.
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The chip shortage came when North American auto factories were closed for two months during the COVID-19 pandemic last year and chip orders were canceled, and demand increased from the consumer electronics industry as people worked from home and played video games. This has now left automakers competing for chips.
Semiconductors are widely used in cars, including to monitor engine performance, manage steering or automatic windows, and in sensors used in parking and entertainment systems.
| Teleprinter | security | Last | Change | Change% |
|---|---|---|---|---|
| F | FORD MOTOR CO. | 12.29 | -0.18 | -1.44% |
| GM | GENERAL MOTORS CO. | 57.44 | -1.08 | -1.84% |
In addition to shutting down the Dearborn plant for the weeks of April 5 and April 12, Ford announced Wednesday that it will idle the truck side of its plant in Kansas City, Missouri, the week of April 5 and shutting down its Louisville assembly plant the weeks of April 12 and 19. It is idling its Oakville plant in Canada for three weeks, starting April 12.
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Ford is also reducing overtime at factories in Dearborn, Kansas City, Chicago and Avon Lake, Ohio.
(Reporting by Ben Klayman in Detroit, additional reporting by David Shepardson in Washington edited by Leslie Adler and Matthew Lewis)
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