New Report Says Ford F-Series Hardest Hit From Global Microchip Shortage
Those who have attempted to buy or order a new Ford F-150 have had their patience tried, that’s for sure. First there was a global pandemic that led to factory shutdowns, then, just as things started getting going in production there was a global-wide shortage of microchips, a minor but key part of most of today’s vehicles.
According to data presented by BuyShares.co.uk, Ford has taken the worst hit by the global microchip shortage, with almost 230,000 vehicles taken out of the production as of May. Ouch! There have been internet photos of mostly completed F-150s sitting in vacant lots or unused raceways or sports facilities.
Each one of those trucks that awaits the all-too-important microchip represents lost revenue for Ford. There had been rumors that Ford might attempt to ship these trucks out with the understanding that when the microchips arrive the installation and final quality check will happen. Nothing has been decided in regard to that according to Ford.
Carmakers across the globe have been struggling to meet customer demand for new cars as the shortage of critical microchips led to plant closures and left dealers with a shrinking inventory. Unfortunately, the US automakers like Ford and General Motors seem to be the worst hit by this situation.
Related story: Chip shortage bring further downtime.
Ford F-Series the Worst Hit Model, Production Cut Down by 110,000 Vehicles
When car factories in the US and across the globe closed in the early days of the COVID-19 last spring, many carmakers made what has turned out to be a critical error. They canceled orders for the microchips essential to the manufacture and operation of new cars.
Although demand for new cars has returned, the microchips, vital for everything from a vehicle's onboard computer to safety features and infotainment system, have been in short supply around the world for months, and the problem could take a couple of years to resolve.
The fire at an automotive chip plant in Japan, tighter supply chains after the Ever Given grounding in the Suez Canal, and the lack of oil for the plastic used in chips all came as a new shock after the pandemic, causing carmakers huge problems with sourcing the microchips.
An AutoForecast Solutions report showed Ford had been the hardest hit by the global microchip shortage, taking over 230,000 vehicles out of production. Chevrolet took the second-hardest hit among the US carmakers, with its production cut down by 140,800 cars. Jeep follows with around 138,700, respectively.
When it comes to the worst impacted models, the Ford F-Series pickup comes first, with its production reduced by 109,710 units due to the microchip shortage. Statistics show 98,584 fewer Jeep Cherokees are planned, while Chevrolet Equinox production will fall by 81,833, ranking as the third worst impacted model.
Related story: Despite complications it's a great time for Ford.
Combined Market Cap of “Big Three” US Carmakers Plunged by $18.8B in a Month
The global microchip shortage and the massive production cuts significantly impacted US carmakers' stock prices. The YCharts data show Ford's market capitalization dropped by $7.8bn in the last month, falling from $63.7bn in June to $55.9bn last week.
General Motors, the US multinational corporation that manufactures Chevrolet, Buick, GMC, and Cadillac, has taken an even heavier hit. Statistics show the market cap of the US market leader in terms of light vehicle sales plunged by $8.4bn in the last month.
Chrysler Stellantis lost $2.6bn in market cap in this period. Statistics show the combined market cap of General Motors, Ford, and Chrysler Stellantis as the "Big Three" US carmakers plunged by $18.8bn in the last month.
It’s tough being in manufacturing right now with a world economy tenuously trying to return to normal. But globally things don’t move super quick, thus you get delays like this one related to the microchips.
Ford would be wise to find a way to get these trucks delivered and make the final repair after the fact. I’m not sure if the trucks are functional without the microchip, but if so, perhaps a delivery and then agreement it will be “recalled” when the chip arrives is the best solution for the auto manufacturer.
Either way, this shortage is bad for the workers at Ford Motor Company and definitely bad for Blue Oval fans, as Ford faces an extremely important year launching the 14th-generation F-150, the all-electric Mustang Mach-E, relaunch of the Ford Bronco and looking toward their first-ever all electric pickup truck.
Clearly this shortage could not come at a worse time for Ford. I think they’ve managed the situations as good as can be expected, but surely customers’ patience is running thin and their dealer network is itchy to add to a very limited supply chain on the lots.
Check out this full story here on this website.
What do you think of this story and the shortage? Leave me your comment below.
Jimmy Dinsmore has been an automotive journalist for more than a decade and been a writer since the high school. His Driver’s Side column features new car reviews and runs in several newspapers throughout the country. He is also co-author of the book “Mustang by Design” and “Ford Trucks: A Unique Look at the Technical History of America’s Most Popular Truck”. Also, Jimmy works in the social media marketing world for a Canadian automotive training aid manufacturing company. Follow Jimmy on Facebook, Twitter, at his special Ford F-150 coverage on Twitter and LinkedIn. You can read the most of Jimmy's stories by searching Torque News Ford for daily Ford vehicle report.