Global chip shortage hits Apple, BMW, Ford as crisis worsens
Peter Vercoe, Bloomberg News VIDEO SIGN OUT
The global chip shortage is going from bad to worse with automakers on three continents joining tech giants Apple Inc. and Samsung Electronics Co. in flagging production cuts and lost revenue from the crisis.
In a dizzying stretch of 12 hours, Honda Motor Co. said it will halt production at three plants in Japan for around five to six days next month; BMW AG flagged it will pause Mini car production at its Oxford, England, factory for three days; and Ford Motor Co. reduced its full-year earnings forecast due to the debilitating chip shortage, which it sees extending into next year.
The negative reaction by investors is a mix of issues related to the chip problem following Ford reporting its results after the closing bell Wednesday.
While analysts were thoroughly impressed with the company s performance in the first quarter, which included a record $4.8 billion in adjusted pretax profits, they were far less impressed, if not confused, with its guidance for the year. Let s just put it like this: Ford s 1Q was far too good to extrapolate while the remainder of the year is too challenged to extrapolate, Morgan Stanley analyst Adam Jonas said in a note to investors.
Ford s stock closed Thursday at $11.26 a share, down 9.4%. Shares remain up 28.1% in 2021. The company s market cap is more than $44 billion.
Ford says 70 percent of the people buying the Mustang Mach-E in the US so far are completely new customers to the brand, which could be a very good sign for the company as long as sales keep growing.
Carmakers join tech giants in production cuts as global chip shortage worsens Honda and BMW to idle factories while Ford reduces its full-year earnings forecast 29 April 2021 - 10:28 Peter Vercoe Picture: 123RF/SASHKIN7
Sydney The global chip shortage is going from bad to worse with carmakers on three continents joining tech giants Apple and Samsung Electronics in flagging production cuts and lost revenue from the crisis.
In quick succession, Honda said it will halt production at three plants in Japan for about five to six days next month; BMW flagged it will pause Mini car production at its Oxford, England, factory for three days; and Ford reduced its full-year earnings forecast due to the debilitating chip shortage, which it now sees extending into next year.