General Motors Explains Why It Got Hit So Hard by the Chip Shortage

The entire automotive industry is struggling with the global chip shortage, but General Motors, in particular, has been having a hard time getting vehicles ready for customers in the third quarter.
GM says the shortage could show signs of recovery in the fourth quarter 6 photos
Photo: GM
GM's Flint assembly plantGM's Flint assembly plantGM's Flint assembly plantGM's Flint assembly plantGM's Flint assembly plant
In addition to temporarily shutting down the production lines at several plants, General Motors also ended up building cars without certain systems and then moving them to local parking lots, planning to install the necessary equipment when more chips were available.

Speaking in a recent interview about how the company tried to cope with the global chip shortage, company CEO Mary Barra explained that the third-quarter crisis was mostly caused by disruptions encountered by suppliers in Malaysia.

Barra revealed that some of the facilities in the country were hit by the health problem the planet is still fighting with. As a result, they had to either slow down the production or even stop all operations completely for a certain period of time.

The CEO, however, says General Motors sent a team of experts to all these facilities in an attempt to help them recover after the shutdown. As a result, every factory was aligned with GM’s safety protocols, Barra said, so now workers can return safely, with the production capacity slowly increasing until the normal levels are reached.

As a result, General Motors now expects the chip shortage to show small signs of recovery in the fourth quarter of the year, especially as foundries across the world have also invested more in accelerating the production of semiconductors.

But of course, the crisis still isn’t gone completely, and experts believe the lack of chips would continue into the next year, possibly even expanding until the fourth quarter.

On the other hand, market research firm IDC recommends everybody to handle investments in more capacity with extra caution, especially as the industry is expected to face an oversupply of chips in 2023 after the strong push for more chips recorded in the last months.
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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