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BusinessChip Shortages Force Daimler and BMW to Slow Auto...

Chip Shortages Force Daimler and BMW to Slow Auto Production

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The global semiconductor shortage is disrupting production in the German car industry just as demand rebounds strongly from the pandemic-induced downturn.

Automakers Daimler and BMW said this week that the lack of chips had forced assembly lines to slow down or stop, cutting output by tens of thousands vehicles and leading to longer wait times for customers.

This week, BMW temporarily stopped production or cut back the number of shifts at three factories in Germany and one in Britain, as well as at factories owned by suppliers in the Netherlands and Austria that assemble vehicles under contract, the company said.

As a result, production fell short by 10,000 vehicles for the week, and there is likely to be a similar shortfall next week, a BMW spokeswoman said Wednesday.

Daimler has been trying to cope with chip scarcity by giving priority to its most expensive and most profitable models. But even they have been affected, Ola Källenius, the chief executive, said during a conference call with journalists Wednesday.

Daimler had to briefly stop assembly lines at a plant in Sindelfingen, near Stuttgart, that produces Mercedes-Benz S-Class luxury cars as well as the new EQS electric vehicle, Mr. Källenius said. One cause was a shutdown at a chip supplier in Malaysia.

“We could certainly have built more cars if we had more chips,” said Harald Wilhelm, the Daimler chief financial officer, adding that he could not predict when the supply of semiconductors will catch up with demand.

“We have to work with uncertainty,” Mr. Källenius told reporters.

The semiconductor drought does not seem to have hurt profit, however. On Wednesday Daimler reported a profit for the second quarter of 3.6 billion euros, or $4.2 billion, after sales surged 44 percent to 43.5 billion euros. During the same period last year, when many showrooms were closed because of the pandemic, Daimler reported a loss of 2 billion euros.



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