Sanctions against Chinese technology companies have also played a role. Nio, one the main challengers to Tesla, which dominates the EV market in China, said it would halt production for five working days at its Hefei plant and cut its first-quarter delivery forecast by as much as 1,000 vehicles. Shares of Nio, which makes the ES8 and ES6 electric sport-utility vehicles, were down more than 8 percent in the US mid-afternoon trading. Nio, which also faces competition from home-grown rivals such as Xpeng, now expects to deliver 19,500 vehicles in the first quarter, down from a 20,000 to 20,500 range previously. Ford had warned the shortage could hit its 2021 profit by up to $2.5 billion (roughly Rs. 1.81 lakh crores), while larger the US automaker GM expects the crisis to shave up to $2 billion (roughly Rs. 1.44 lakh crores) off its full-year profit.
Ford, which was until now assembled its highly profitable F-150 without certain parts, said on Thursday it will idle production of the trucks at a plant in Michigan through Sunday. GM and Japan’s Honda both said this week they would continue production suspension at plants in North America for the coming weeks. Swedish truck maker Volvo AB meanwhile said on Tuesday the chip shortage would have a “substantial” impact on its second-quarter earnings, and it would implement stop days across its sites globally beginning in April.
© Thomson Reuters 2021