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Volkswagen likely to cut output amid chip shortage

Volkswagen likely to cut output amid chip shortage

Mubasher: Volkswagen may need to further reduce its production due to the global semiconductor supply shortage, the German automobile manufacturer announced on Thursday, as reported by Reuters.

The auto industry is facing continued pressure following a recovery in demand earlier this year from the negative impact of the coronavirus (COVID-19) pandemic.

Previously, a report referred that Toyota would cut output by 40% in September.

These decisions follow news referring that the German chipmaker Infineon had been forced to suspend production at one of its plants in Malaysia in June due to the outbreak.

Volkswagen reportedly expects a very tight and volatile supply of chips in the third quarter (Q3) of the year, considering further changes to production.

However, the carmaker forecasts that the situation would improve by the end of the year and seeks to compensate for the production cut in the second half.