Muscle car manufacturers aren’t strong enough to overcome supply chain problems haunting businesses everywhere.
Ford and GM announced last week that they were pausing production on their Mustang and Camaro models. Ford attributed its decision to close its Flat Rock Assembly Plant, which employs 2,420 people and produces the Ford Mustang and Shelby GT350 and GT350R, to the global semiconductor shortage.
GM said a temporary parts shortage forced it to close its Lansing Grand River plant. The company said semiconductor chips weren’t the problem, but it didn’t provide specifics.
Both plants are scheduled to open again on April 11.
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Ford sold 52,414 Mustangs in the United States last year. Sales have been declining since it sold more than 122,000 in 2015. So far, in 2022, Ford reported it has sold 10,371 Mustangs in the U.S.
Chevrolet has fared even worse, moving just 21,893 Camaros last year and 6,710 so far this year.
This round of closures isn’t the first time supply chain snarls halted production.
Semiconductor chips might not be GM’s problem with producing Camaro’s this year, but last March, it shut down its Lansing Grand River plant due to a shortage of chips. Last week, GM blamed chip shortages for its pause in production for two weeks at its plant in Fort Wayne, Indiana. That plant produces Chevrolet Silverados, the No. 3 bestselling vehicle last year.
As recently as last month, Ford had to halt production for its F-150, the No. 1 bestselling car in the U.S. last year.
Ford warned last month that semiconductor chip shortages will make manufacturing painful. Besides its plant producing F-150s, Ford suspended or cut production at eight facilities in North America.
Car manufacturers were especially affected by the COVID-19-induced supply chain problems. The precious semiconductor chips are key components of vehicle operating systems.
To blunt the effect of the U.S.’s reliance on chips produced overseas, Intel announced earlier this year that it was planning on investing $20 billion to build a semiconductor factory in Ohio. But construction of that plant won’t begin until later this year and isn’t planned to begin producing chips until 2025.
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Last month, President Joe Biden touted the currently stalled Bipartisan Innovation Act, which would pour more than $50 billion into domestic research and development of semiconductors, lamenting the U.S.’s declining presence in the market.
“This puts us at the mercy of shortages and supply chain bottlenecks, but we have an opportunity to reclaim the position of leadership. I think there’s a bipartisan consensus,” Biden said. “The bottom line is this bipartisan innovation bill will allow us to stamp more products made in America, and it’s going to bolster our national security and economic security. It matters. So let’s get it done.”
