General Motors Says the Worst of Chip Shortage Is Over, Record Sales Expected This Year

GM says production of cars should ramp up later this year 6 photos
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Opinions are still mixed as to whether the chip shortage would be over this year or not, but General Motors appears to be on the optimistic side of things this time.
After reporting its fourth-quarter earnings and beating Wall Street’s expectations, General Motors says it expects 2022 to be the year of recovery, especially as there are signs the chip shortage is easing off.

CEO Mary Barra said in a letter to shareholders that the company is seeing “an improved outlook for semiconductors in the U.S. and China,” so the carmaker expects 2022 results to be strong.

We expect our EBIT-adjusted earnings to remain at or near record levels in the range of $13 billion—$15 billion,” Barra noted.

Indeed, General Motors has been one of the automakers whose production was massively impacted by the lack of semiconductors.

The company suspended the production at several facilities on multiple occasions and eventually ended up shipping certain vehicles without a series of systems in an attempt to deal with the lack of chips.

While General Motors sees 2022 as the year when the chip shortage could be over, rival Ford isn’t necessarily so optimistic. The company expects the next quarters to be rather difficult in terms of chip inventory, explaining that it’s now trying a different approach that would essentially come down to prioritizing certain models in its lineup.

In other words, Fords wants to use its exciting chip inventory to maintain the production of its most popular vehicles, such as the F-150, unaffected by the global crisis. This means other models could eventually be affected, though the company is working with a dynamic chip inventory, and it hopes to resolve any production challenge when it arises.

For now, however, there’s no guarantee the chip shortage would be over this year, as most experts believe it all depends on the global health issue and how it evolves after the current wave.
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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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