GM says chip situation improving

Reuters — Top U.S. automaker General Motors said on Friday the semiconductor chip shortage that has hit production at automakers worldwide was abating, while reporting its first quarterly sales fall in a year.

“As we look to the fourth quarter, a steady flow of vehicles held at plants will continue to be released to dealers,” GM said, adding that it was expecting a more “stable operating environment.”

The company said all of its full-size pickup, full-size sports utility vehicle and mid-size pickup truck plants in North America were operating as of this week.

Chip shortages and supply chain disruptions have forced automakers worldwide to cut production and in some cases, to produce vehicles without chips and park them at their facilities.

The problems have, however, allowed then to sell vehicles at higher prices due to record purchases from consumers, who are flush with cash amid low interest rates and rising wages.

“We expect to continue selling every vehicle we can produce with rapid turnover,” GM chief economist Elaine Buckberg said.

The Detroit automaker’s third-quarter sales fell to 446,997 vehicles, down by 218,195 vehicles from a year earlier.

In Canada alone, Chevrolet, Buick, GMC and Cadillac dealers delivered 48,657 vehicles in the third quarter, down 23 per cent from a year ago, the company said in a separate release Friday.

Sandor Piszar, GM Canada’s vice-president for sales, service and marketing, said those results “reflect how the shortage of semiconductors continues to impact vehicle production and dealer inventory.”

However, he said in Friday’s release, increased sales of utility vehicles such as the GMC Yukon, Chevy Tahoe and Cadillac Escalade during Q3 “illustrate how GM is prioritizing production of our most in-demand models.”

Pickup production, meanwhile, is due to begin later this year at GM Canada’s Oshawa assembly plant, “marking one of the fastest plant launches in GM’s history,” the company said.

— Reporting by Abhijith Ganapavaram in Bangalore. Includes files from Glacier FarmMedia Network staff.