Stellantis, the automaker created by the Fiat Chrysler and PSA merger, has warned that the global semiconductor shortage will hit production harder in the second quarter than in the first three months of the year.
The warning from the world’s fourth-largest automaker echoes predictions from Volkswagen, who also told its brand executives to expect a worse situation in the April-June quarter.
The chip shortage was caused by an unexpected rebound in demand for cars late last year, following lower demand due to the coronavirus crisis that coincided with a booming consumer electronics market.
Automakers around the world have been caught off guard and had to slow down or revamp production, slashing production by 1.3 million cars in the first quarter, according to IHS Markit.
Ford, which competes directly with FCA brands such as Jeep and Ram, expects to lose half of its production in the second quarter in a setback that will cost the automaker billions, while Renault also warned of poor visibility of chip supplies this quarter.
Stellantis saw eight of its 44 global factories idle at some point during the quarter, with most disruptions affecting its North American operations.
Production losses due to chip shortages amounted to nearly 190,000 units in the quarter, or 11% of planned production.
However, Stellantis revenue rose 14 percent to 37 billion euros, in part due to higher overall volumes, while the only region where car deliveries declined was in North America.
Sales to Europe, South America, the Middle East and China all increased, as did sales of the Maserati brand.
The group has responded to the shortages by focusing on building its most profitable car models to minimize the financial blow and reducing the amount of inventory on dealer strongholds.
Richard Palmer, the group’s chief financial officer, said the company had “delivered strong revenues in the first quarter of 2021.. . despite the headwinds of the global semiconductor crisis ”.
Jefferies analyst Philippe Houchois said the group has achieved “better volume than its generalist peers so far in the season.”
The company expects “some improvement” in the second half of the year and has maintained its margin expectations between 5.5% and 7.5% from the 5.3% figure last year, before the merger of the companies. groups.
Stellantis expects savings of € 5 billion from the € 50 billion merger, although a strategic plan for both activities will not be developed until next year.