Jeep plant production picks up, though some sites face more downtime
Jeep plants in Detroit and Warren where production was cut due to the global semiconductor shortage are returning to full force this week, though parent Stellantis NV indicated the supply-chain constraint continues to ebb and flow.
Jefferson North Assembly Plant resumes full production of the Jeep Grand Cherokee and Dodge Durango SUVs after running with limited crews since late April. Warren Truck is restarting assembly of the Ram 1500 Classic pickup ahead of the launch of the Jeep Wagoneer SUV there, which is scheduled for Monday, according to AutoForecast Solutions LLC. Production in Warren has been affected since late March.
The shortage of microchips used in consumer electronics, including vehicles' automated driving features, heated seats and infotainment systems, has forced companies to prioritize the allocation of scarce chips to higher-margin models like trucks and large SUVs. The production cuts have crimped new-vehicle supply as demand recovers from the COVID-19 pandemic, causing dealerships to be short on vehicles. That has raised the prices of new and used vehicles.
Illinois' Belvidere Assembly Plant, home of the Jeep Cherokee crossover, and Ontario's Windsor minivan plant also resumed production this week with one of two shifts after being down since late March. The shortage, however, will halt production at both plants the following week.
"Stellantis continues to work closely with our suppliers to mitigate the manufacturing impacts caused by the various supply chain issues facing our industry," spokeswoman Jodi Tinson said in a statement.
Toluca Assembly Plant in Mexico is shut down this week and next, the company added. Toluca produces the Jeep Compass crossover.
Stellantis lost 11% of planned global production, or about 190,000 vehicles, in the first quarter of 2021. CEO Carlos Tavares said last month the second quarter is expected to be the worst for the company with respect to the shortage following a February cold snap that affected microchip production in Texas and a March fire at a semiconductor factory in Japan operated by the Renesas Electronics Corp.
Renesas, the third-largest maker of automotive chips by revenue, said Tuesday that facility is running at about 88% of what it was making before the blaze, the Associated Press reported. Replacements for the damaged equipment arrived in May and should be in operation by mid-June to return to full production. While that should help the auto industry, scarcity of microchips is expected to persist beyond the end of 2021, experts have said.