Now It's Honda's Turn To Be Affected By The Chip Crisis, Are They Reducing Car Production?

Honda reduces car production due to global chip crisis (Motor1)

JAKARTA – Due to the limited supply of global chips, it has had an impact on world automotive companies. Some time ago Tesla also reportedly postponed the production of its cybertruck due to the chip crisis. Now the car manufacturer Honda is reportedly starting to be affected by the global chip crisis. Previously, other car manufacturers such as Toyota, Subaru, and Suzuki had already felt the impact.

Cited from Nikkei, Honda's production in Japan was forced to drop 60 percent from the initial plan in the period August to September 2021. This was caused by the chip crisis and delays in the delivery of spare parts during the global pandemic.

On the other hand, Honda has predicted that the impact caused by the scarcity of these chips will continue until next month. Therefore, Honda is currently trying to minimize the impact of the chip crisis and the supply of spare parts in the company. They are also still exploring other impacts that will arise from this problem.

With the limited supply of chips, Honda was forced to stop its factories in Suzuka and Sayama. The Japanese automotive company also plans to cut the supply of the N-Box and Stepwgn.

As a result of the crisis, Honda predicts that its global car sales in 2021 will decline by 150.000 units from the initial estimate to only 4.85 million units.

Another problem that Honda experienced was the long queue of orders that lasted for more than a year. Especially for ordering Honda Vezel. A number of other cases of the N-One kei car were also delayed by more than six months.

According to the Boston Consulting Group (BCG), the global chip crisis is predicted to cut global car production by around 7 to 9 million units in 2021. The reduction of 10 million will make sales of around 74 million units only.

This is equivalent to sales that took place in 2020. At that time, car manufacturers were affected by the COVID-19 pandemic. BCG considers that the supply of chips will not be safe until the second half of 2022.