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No short-term end for microchip shortage in auto sector


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Unifor Local 200 president John D’Agnolo said Ford Motor Company doesn’t expect any easing of the microchip shortage until at least the third quarter of 2022.

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While the Annex Engine Plant maintained full production, the Essex Engine Plant was idled this week due to a lack of the critical part.

“It hasn’t gotten any better,” D’Agnolo said. “There’s been zero improvement.

“My concern is battery-electric vehicles need umpteen more chips. It’s going to get worse.”

D’Agnolo said both of Ford’s local engine plants are scheduled to run next week.

Stellantis’s Windsor Assembly Plant, however, faces disruptions.

After operating per normal this week, production on Monday has been cancelled with the plant set to resume operations on Tuesday.

“Stellantis continues to work closely with our suppliers to mitigate the manufacturing impacts caused by the various supply chain issues facing our industry,” said LouAnn Gosselin, Stellantis’s Canadian head of communications. “Due to the unprecedented global microchip shortage, production at the Windsor Assembly Plant will be down on Monday, March 7.”

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With all automakers scaling up their electric vehicle production, millions more microchips are going to be needed.

D’Agnolo said the new electric Ford Lightning pickup truck, that has sold out its 150,000 pre-orders, will need a lot more microchips than the combustion-powered F-150 pickup. Ford will begin filling Lightning orders in the spring of 2023.

“The real interesting thing is the Lightning needs eight to 10 times more chips,” D’Agnolo said.

“How are they going to balance that out between the combustion engines side and the Lightning’s needs? They’re going to have to make some tough choices.

“I’m hoping that by the end of the year, they’re right and there’ll be more chips available and it’ll soften this issue.”

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Ford has sourced more chip supply. The company announced a partnership with U.S.-based GlobalFoundries last fall, and Intel announced earlier this year it will spend $20 billion to build two chip factories in Ohio.

Global shortage continues. Nick Dimitrov, vice-president of sales and applications at AIS Technologies in Windsor, displays a circuit board with tiny semiconductors on Feb. 5, 2021.
Global shortage continues. Nick Dimitrov, vice-president of sales and applications at AIS Technologies in Windsor, displays a circuit board with tiny semiconductors on Feb. 5, 2021. Photo by Dan Janisse /Windsor Star

Samsung is also constructing a $17-billion chip plant in Texas and the Taiwan Semiconductor Manufacturing Company and INTEL are partnering on a 5.6-million-square-foot plant near Phoenix, Arizona.

However, all these new plants are two to three years from beginning production.

Ford has also announced its interest in developing its own chips and doing more work in-house, but that too won’t do anything to alleviate the uncertainties of production in the short term.

“The lead time on production schedules remains day-to-day,” said D’Agnolo, adding the supply chain issues associated with the Ambassador Bridge blockade last month have ceased. “It’s an extremely difficult way to work.

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“At Windsor Assembly, they got told on Fridays whether they’re working next week. Then, all the parts suppliers are scrambling depending on if you’re working or not.”

D’Agnolo said the Windsor plants are fortunate that they’re producing engines for Ford’s most popular and profitable vehicles, so they’re likely to get their fair share of microchips. The plant makes engines for the F-series pickup trucks, the Mustang and commercial vans.

The Essex Engine Plant produces close to a thousand 5.0-litre engines daily while the Annex manufactures 700 7.3-litre engines.

“When they leave Windsor, the engines are ready to go,” D’Agnolo said.

“But we have fields full of vehicles sitting there because they need chips for other things in the vehicles. It’s very frustrating.”

Dwaddell@postmedia.com

twitter.com/windstarwaddell

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