AB Volvo warns of production fall due to chip shortage

Analysts estimate that Volvo will make 16,000 fewer trucks in the second quarter

                                

Swedish truck manufacture AB Volvo has warned of a production hit in the second quarter due to the shortage of semiconductors, sending its shares down seven per cent.

Due to the worldwide shortage the company, which has 18 production facilities globally, was forced to cut production at its factories in Belgium and Brazil.

Volvo, which competes with Germany’s Daimler and Traton, said visibility into the supply chain of semiconductors was very low and that the disturbances would also impact other business units of the group.

Analysts at Deutsche Bank estimated that Volvo would make 16,000 fewer trucks in the second quarter and consensus earnings could come down by four to seven per cent this year.

Semiconductor shortages have hit global automakers, forcing them to cut or stop production as the available supply of chips were taken by makers of electronics such as smartphones, as they have a higher consumer base.

US automakers including General Motors and Ford, Germany’s Volkswagen and Japan’s Honda Motor have all been affected by the shortage.

Volvo Cars had also said it would temporarily stop or make adjustments to production in China and the US during March.

FURTHER READING: Hyundai makes $900m electric car recall

The material provided on this website is for information purposes only and should not be regarded as investment research or investment advice. Any opinion that may be provided on this page is a subjective point of view of the author and does not constitute a recommendation by Currency Com Bel LLC or its partners. We do not make any endorsements or warranty on the accuracy or completeness of the information that is provided on this page. By relying on the information on this page, you acknowledge that you are acting knowingly and independently and that you accept all the risks involved.
iPhone Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image
Trade the world’s top tokenised stocks, indices, commodities and currencies with the help of crypto or fiat
iMac Image