The ongoing global microchip shortage has had a profound impact, with production cuts and reduced availability across the entirety of the auto industry. Looking forward, General Motors says it now expects production normalization by the 2022 calendar year.
Last week during a fireside chat with Credit Suisse, General Motors CEO Mary Barra and General Motors CFO Paul Jacobson addressed GM’s production management during the microchip shortage, including expectations for when production will normalize.
“We expect the middle part of the year, the second quarter, and given the timing, and now some of the chips have moved, we may see a little bit of a challenge creeping into the third quarter as well,” Jacobson said. “But we certainly see it starting to get better in the second half, and hopefully, getting to a point where we reach normalization in 2022.”
Despite the optimism for 2022, Jacoboson also expressed wariness with regard to making predications. “I caution going out that far given how rapidly this has changed,” he said. “I don’t think my colleagues that have been at GM much longer than I have even seen anything like this.”
“From a week-to-week, a month-to-month basis, we see some chips coming in better than we thought, and some chips deferring out longer then we thought, and we’re really just trying to manage through that dynamic situation,” Jacobson added.
As GM Authority reported last week, General Motors expects much-improved first-half financial results, with the potential to beat first-half guidance reported previously. Further information is set to be announced during the Q2 earnings conference call in August.
Additionally, the automaker says it will ramp up vehicle deliveries in the United States and Canada in the coming months, with an increase of roughly 1,000 units per month in mid-July with regard to production of the Chevy Silverado HD and GMC Sierra HD pickup trucks.
It’s estimated that the global microchip shortage has resulted in lost production amounting to 278,000 fewer GM vehicles thus far.