While Lightning strikes, eight Ford plants set to witness production cuts

Production at eight North American Ford Motors plants will either be cut down or halted due to the semiconductor chip shortage in the automobile industry. This production halt will continue throughout June for different periods for every plant, reported CNBC.

The announcement comes a day after President Joe Biden visited the Ford headquarters in Dearborn, Michigan, where he pitched his $2.3 trillion infrastructure plan which includes electric vehicles. He addressed the semiconductor chip shortage issue and the need for domestic chip production to avoid such a situation from arising again.

The Dearborn headquarters will unveil the upcoming F-150 Lightning pickup truck on Wednesday at 9.30 P.M. ET. The Dearborn truck plant is one of two facilities that produce the extremely profitable, full-size F-150 pickup, whose production will be halted too. The other affected vehicles include Ford Mustang, Escape crossover, and Bronco Sport SUV, reported CNBC.

Ford CEO Jim Farley had warned investors that the company expected to lose about 50% of its planned Q2 production, up from 17% in Q1, a few weeks ago, before announcing the cuts today.

Meanwhile, Ford expects problems from the chip shortage to reduce its earnings by about $2.5 billion in 2021, the high end of its previous guidance for the year, reported CNBC.

The production of Ford’s new electric pickup truck is set to start next spring at the River Rouge assembly plant near Detroit. Ford said last year that it was expanding its largest and oldest factory to make the electric pickup trucks. Automakers including General Motors, Volkswagen, and Tesla are racing to develop electric vehicles. Tesla expects to release its pickup trucks by the end of 2021.

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