The ongoing global microchip shortage has affected the entirety of the automotive industry, curtailing production and impacting vehicle supplies. However, as General Motors works to recover from the shortage and ramp up production, the automaker expects its first-half financial results to be “significantly better” than first-half guidance reported previously.
General Motors recently announced that it was “optimistic” about the financial results expected by the end of the 2021 calendar year, with further information slated to be revealed during the upcoming Q2 earnings conference call in August.
“The global semiconductor shortage remains complex and very fluid, but the speed, agility and commitment of our team, including our dealers, has helped us find creative ways to satisfy customers,” said GM vice president, North America Manufacturing and Labor Relations, Phil Kienle. “Customer demand continues to be very strong, and GM’s engineering, supply chain and manufacturing teams have done a remarkable job maximizing production of high-demand and capacity-constrained vehicles.”
General Motors expects production impacts from the microchip shortage will continue at facilities in North America, Asia, and South America through June and July. However, as the automaker implements strategies to hasten its recovery and resume production, deliveries to dealers are expected to increase through the second half of the 2021 calendar year.
“GM continues to work with its suppliers and policy leaders to develop long-term solutions to the semiconductor supply issues that have impacted all automakers,” the automaker states.
General Motors previously reported Q1 2021 financial results, which were headlined by $3 billion in income on $32.5 billion in revenue, with GM Financial posting $1.2 billion Earnings Before Taxes (EBT)-adjusted.
Recent estimates place production cuts stemming from the microchip shortage at roughly 278,000 General Motors vehicles so far, the second highest lost production volume behind Ford. To soften the blow, General Motors has adopted a “build-shy” strategy to keep its most popular and high-profit models rolling off the line, namely its full-size SUVs and trucks, with uncompleted vehicles stockpiled as new chips are acquired.