General Motors will keep its Fairfax Assembly plant in Kansas shut down until the first week of July due to a shortage of semi-conductor chips.
Fairfax Assembly, which builds the Chevy Malibu sedan and Cadillac XT4 crossover, has been shut down since early February due to a supply shortage of microchips. The automaker provided an update on the situation as Fairfax this week, confirming it will keep the plant idled until at least the first week of July.
The American automaker said last week that its CAMI plant in Ingersoll, Ontario, which builds the Chevy Equinox crossover, would also remain shut down until the end June.
In a statement, GM said it is staying in contact with chip suppliers to monitor the situation and will prioritize its most popular models, such as full-size trucks and SUVs, while the chip shortage lasts.
“We continue to work closely with our supply base to mitigate the short-term impact and leverage every available semiconductor to build and ship our most popular and in-demand products, including full-size trucks and SUVs for our customers,” the automaker said.
Similarly, the automaker confirmed this week that its San Luis Potosi plant in Mexico will take downtime May 17th to the 24th, while the Ramos Arizpe plant in the country will remain idle between May 3rd and May 24th. The San Luis Potosi facility builds the Chevy Equinox and GMC Terrain, while Ramos Arizpe produces the Chevy Blazer and Equinox.
The automaker’s Wentzville Assembly plant in Missouri has also moved from three shifts to two amid the chip shortage. The Wentzville plant produces the Chevy Colorado and GMC Canyon mid-size pickups, along with the Chevy Express and GMC Savana utility vans.
GM remains hopeful that it will be able to make up for lost production later in the year, but with demand for microchips continuing to outpace supply and production, the shortage could have a bigger effect on auto production this year than many experts initially thought. GM Rival Ford cut its second-quarter production outlook by half in its Q1 earnings report over the chip supply issue and said the shortage could last into early 2022.
Roughly 75 percent of the world’s microchips are produced in Asia. The United States, by comparison, has about 12 percent of the world’s chip manufacturing capacity.
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Comments
Shutdown and change over to 22s and stock up on chips.
Tough sheeet. That’s what you get when you rely heavily on other countries and companies to make your parts. GM once had everything made in house for decades, from interior materials, Delco-Remy for its electric parts, to the Fleetwood Body division for its body sheetmetal. They pretty much had every component supplier that they needed to build a car within miles from each other as well, plus GM owned them outright.
Today GM, just like the rest of them, don’t build or produce their own parts anymore. Everything comes from a supplier that aren’t owned by GM either which makes doing business with that company risky as GM doesn’t control the cost, the supplier does.
I’m glad this is happening, maybe now the automakers will realize that they can’t depend on semiconductor companies from Asia to give them what they want. Maybe they will start investing at home in building and constructing semiconductor plants here in the U.S. where GM will have full control over it and not have chip makers pick and choose who they want as customers.
If not, they will face continued chip shortages for the foreseeable future especially when EV’s start to pick up steam. Those vehicles will literally be computers on wheels more so than any ICE engine.
It’s simply impossible for GM to build their own chips. Your Spark would cost the same as a Rolls Royce if they did this.
AMD, who’s entire existence depends on producing microchips gave up and sold off their production more than 10 years ago. Same with IBM. Look at other fabless companies like Nvidia, Qualcomm, Broadcom, Apple. Automakers who buy less chips in one year than Apple does in a day have no chance.
The problem is Moore’s Law is dying. There are two companies in the world who can make up-to-date chips, and that’s it. You need to throw hundreds of billions of dollars to develop the processes needed to make chips. The mask sets needed to make a single design are in excess of $10 million, design costs are pushing $100 million.
Chips are not similar to bent pieces of sheet metal: there are enormous fixed costs that have to be amortized over all of your daily gadgets. That’s why the situation is the way it is.
GM does it’s best to outsource everything it possibly can because they don’t want the legal responsibility for the part, nor do they want the pay/pension/retirement issues that they’d have if they had to hire the employees to make and/or install said parts. Having said that, the chip issue is another thing entirely, and as usual, is due to GM’s chronic short-sightedness. During the Covid shutdowns, they were not building or selling very many vehicles, so they made a huge reduction in the number of chips they bought from their supplier(s). The game-console and other electronic product makers swooped in, ordered and bought up all of the chips. Now that the market is returning to normal, the suppliers told GM to go suck an egg, they have other orders to fill first. Now it seems that Intel is going to get into the game and start manufacturing the chips automakers need because they claim they can do it within 6 months (as opposed to a new factory taking up to 3 years to build and come online). We’ll see…
A ton of Sierra 1500 AT4’s were delayed last week due to the chip shortage. Basically anything with the Tech package, and/or Driver Alert I & II.
The US has 2 plants being built one by Apple and one by Intel and plan to be online in 2023. Intel said they might be able to help some now and is in talks with US car makers. Many chip parts are made in US but shipped overseas because of the infrastructure you need to make them is very expensive. No automaker has ever made their own chips they just build the electronics themselves after sourcing the chips.
The cost of anything electronic is going up. If you want a cheap computer or TV you better get it now. Prices are going to go up by the end of the year.
years ago yes built in house, then they out source work to work around high union wages and some of plants were also union bto
They should have seen this coming two years ago The US needs to pull its head out on our asses and get these chips made here with all sorts of parts being outsourced to other countries this was a train wreck waiting to happen no one to blame but ourselves
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