General Motors is Extending Plant Shutdowns Because of This

General Motors revealed recently that the company is extending plant shutdowns due to a global semiconductor chip shortage.

Three of the company’s North American plants will remain closed. Previously GM had said the plants would be closed until at least mid-March.

The San Luis Potosi plant in Mexico is now scheduled to be down through the end of March, while the U.S. and Canada plants will be shuttered until at least mid-April.

GM’s decision to extend the shutdowns is in an effort to prioritize chips for production of the company’s full-size pickup trucks and SUVs.

Not long ago GM CFO Paul Jacobson said the chip shortage was improving, but the company still expected the delays to lower its free cash flow by $1.5 billion and $2.5 billion in 2021.

“GM continues to leverage every available semiconductor to build and ship our most popular and in-demand products, including full-size trucks and SUVs for our customers,” the company said in a statement. “GM has not taken downtime or reduced shifts at any of its truck plants due to the shortage.”

According to AlixPartners’ estimates, the chip shortage to cut $60.6 billion in revenue from the global automotive industry this year.

“Semiconductor supply remains an issue that is facing the entire industry,” GM said in a statement. “GM’s plan is to leverage every available semiconductor to build and ship our most popular and in-demand products, including full-size trucks and SUVs and Corvettes for our customers.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.