Ford To Halt Production For 2 Days At Mexican Plant Due To Shortage Of Parts

Ford Motor Co F is preparing to halt production for two days next week at the Hermosillo plant in Mexico due to a shortage of material, Reuters reported on Thursday, citing the plant’s labor union.

What Happened: Ford will temporarily suspend production on Monday and Tuesday and the automaker will pay workers 75% of salaries on those days, as per Reuters. The Hermosillo facility in Sonora makes the Bronco Sport SUV.

The labor union did not say what materials were in short supply, as per the report. 

Earlier this month, Ford and rival General Motor Co GM extended production cuts at some of their manufacturing facilities in the United States.

Why It Matters: Global semiconductor shortages have forced automakers to build their most profitable models first as they struggle to secure key semiconductors that are essential to make a fully functional vehicle. 

Tesla Inc TSLA CEO Elon Musk on Friday at the company’s annual shareholder meeting said deliveries in the future depend on the supplier challenges.

“If we can get the chips, we can do it,” Musk said while talking about the electric automaker’s exponential delivery growth in the last quarter despite the challenges.

See Also: Tesla Annual Shareholders Meeting Takeaways: Headquarters To Texas, No Stock Split, Cybertruck And More

A global chip shortage started in 2020 after the COVID-19-induced lockdowns ended and demand sprung back up, quickly surpassing expectations. Most chipmakers don't expect the shortage to ease until late 2022.

Price Action: Ford shares closed 5.45% higher at $14.89 on Thursday.