GM Extends Outages in North America, Brazil on Chip Shortage

“Our intent is to make up as much production lost at these plants as possible,” a GM spokesman said on Wednesday, March 3.

The Detroit-based automaker, the largest in the U.S., announced in February that it would extend downtime at the Fairfax assembly plant in Kansas, its CAMI assembly plant in Ingersoll, Ontario, and its San Luis Potosi plant in Mexico. And GM had warned that additional downtime might be necessary.

The Fairfax and Ontario assembly plants will now be shut from mid-March to at least mid-April. The San Luis Potosi plant will extend downtime through the end of March. And production will halt at the Gravatai plant in April and May, according to a statement from the company.

Those actions come because GM is allocating the semiconductors necessary to make microchips so that it can continue to build its most in-demand products, namely full-size trucks and SUVs, the spokesman said.

“We have not taken downtime or reduced shifts at any of our truck plants due to the semiconductor shortage,” he added.

The shortage has also spread into the appliance industry. The Association of Home Appliance Manufacturers, a lobbying group for that industry, warned in late February that the chip issue had become so severe that semiconductors might be re-allocated to other sectors.

U.S mills have to date mostly told Steel Market Update that the chip shortage has not materially impacted demand.

Domestic flat-rolled steel prices in the meantime continue to march higher and to set new records. SMU’s average hot-rolled coil price stands at $1,240 per ton, up nearly 26% from $985 at the beginning of the year and up approximately 16% from a prior highwater market of $1,070 per ton in July 2008, before the financial crisis.

The current price is also about 182% above a 2020 low of $440 per ton recorded in August.

By Michael Cowden, Michael@SteelMarketUpdate.com