Chip crunch to impact global auto production into third quarter, says IHS

FILE PHOTO: A car body is moved in a production line at the Volkswagen plant in Wolfsburg, Germany March 1, 2019. Picture taken March 1, 2019. REUTERS/Fabian Bimmer/File Photo

(Reuters) - A shortage of auto chips could impact 672,000 units of global light vehicle production in the first quarter, data firm IHS Markit said on Wednesday, warning that the disruption could extend into the third quarter.

Ford Motor Co, Toyota Motor Corp, Fiat Chrysler Automobiles and Nissan Motor Co had cut output due to the shortage, while Volkswagen has said the supply constraints would impact production at some of its plants in February.

“Because the cause of these constraints is the result of increasing demand from OEMs and limited supply of semiconductors, it will not be resolved until both forces are aligned,” said Phil Amsrud, senior principal analyst-ADAS, Semiconductors and Components, IHS Markit.

China will be the most hit in the first quarter at nearly 250,000 units, according to IHS.

AutoForecast Solutions, which tracks industry production plans, on Tuesday forecast production volume impact of 964,000 vehicles in 2021 due to semiconductor shortage.

Meanwhile, a group of 15 U.S. senators on Tuesday urged the White House to work with Congress to address the global semiconductor shortage. (

Reporting by Shreyasee Raj in Bengaluru; Editing by Sriraj Kalluvila