Honda Motor Co plans to suspend production at some plants in the US and Canada next week as the COVID-19 pandemic, a chip shortage and severe winter weather have affected its supply chain, a company spokesperson said.
The automaker is to halt work at plants in Marysville and East Liberty in Ohio, as well as others in Indiana, Alabama and Ontario, potentially for a week, the spokesperson said yesterday, without specifying the volume of vehicles affected.
Honda made 1.45 million vehicles in North America last year, down 20 percent from 2019. The Japanese company has 12 manufacturing plants in the US and one in Canada.
Separately, Toyota Motor Corp said that the cold front had reduced supply of petrochemical products, affecting production in the US and Mexico.
Some lines, shifts or potentially entire plants are expected to be temporarily halted for several days in Kentucky, West Virginia and Mexico, spokeswoman Shiori Hashimoto said, without providing further details.
The bad weather has added to disruptions for automakers already battling a shortage of semiconductors, which are being gobbled up by consumer electronics companies trying to meet an increase in demand from users stuck at home during the pandemic.
Honda and Toyota already scaled back output at plants around the world earlier this year due to the lack of chips. Major tech companies have also warned about a serious imbalance in supply.
Mitsubishi UFJ Morgan Stanley Securities Co has said the shortage could reduce Honda’s output by 300,000 units, while Toyota is less affected, because it is not as reliant on foreign semiconductor companies.
In Europe, the auto industry reported its worst February sales in eight years, because much of the region remains locked down to contain the pandemic.
Registrations plunged by one-fifth to 850,170 vehicles, the lowest total for the month since 2013, the European Automobile Manufacturers’ Association said.
Spain led declines among major markets with a 38 percent fall, while the UK shrunk 36 percent.
Europe’s struggle to inoculate citizens from COVID-19 risks tainting automakers’ more upbeat forecasts for the year.
Shuttered showrooms, slow vaccination distribution and economic damage caused by the virus call into question the high expectations for earnings recovery, Bloomberg Intelligence analyst Michael Dean said.
Among the continent’s biggest automakers, deliveries for Renault SA fell the most at 29 percent, followed by Stellantis NV at 22 percent. Both manufacturers count the region as their most important sales hub.
Volkswagen AG fared marginally better with a 19 percent decline.
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