Semiconductor shortage shuts down CNH

Semiconductor shortages are hitting the supply chains of truck and vehicle manufacturers world-wide and slowing manufacturing and supply of trucks, buses and other vehicles.

Techwire Asia reports that by mid-2020 onwards, there was a surge in demand for semiconductor content in the automotive industry, driven by the adoption of technologies such as driver-assistance systems and safety features. In fact, Intel projects that semiconductors will account for over 20% of the input costs for new premium trucks and cars, up from just 4% in 2019.

Therefore, it is not surprising that manufacturers are struggling to keep pace, especially given how the pandemic that led to a global lockdown has exposed pressure points in the global chip supply chain.

As a consequence, CNH Industrial has today announced that it will temporarily close several of its European agricultural, commercial vehicle and powertrain manufacturing facilities in response to ongoing disruptions to the procurement environment and shortages of core components, especially semiconductors.

CNH Industrial said in a press statement that it is constantly reviewing its production schedules in response to this highly dynamic environment and plans to shut the concerned plants for no longer than eight working days in the month of October.

The Company went on to say that it remains committed to optimising its manufacturing operations to meet continued strong demand and best serve its dealers and customers.