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Ford to Cut Output Due to Semiconductor Shortage

Ford's reduction applies to its top-selling F-150 truck, Escape crossover, the Mustang and Bronco Sport SUV intermittently through June.
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Ford Motor  (F) - Get Report will trim output of its vehicles, including its top-selling F-150 truck, intermittently through June at eight North American plants, due to the semiconductor shortage, the company told CNBC.

Other vehicles that are part of the manufacturing suspension include the Mustang, Escape crossover and Bronco Sport SUV.

The news didn’t appear to affect Ford shares much. They eased 0.54%, in line with the overall market Wednesday, to $12.07. The stock has jumped 37% in the last six months amid optimism about vaccines and economic recovery.

“Our teams continue making the most of our available semiconductor allocation and will continue finding unique solutions to provide as many high-quality vehicles as possible to our dealers and customers,” Ford said in a statement to CNBC.

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The affected plants includes ones in Chicago; Michigan; Kansas City, Mo.; Mexico; Louisville, Ky.; Oakville, Canada; and Ohio.

Last month, Ford posted first-quarter earnings that beat analysts’ forecasts, but also said second-half production will be hit dramatically by the chip shortage.

The company said it expects to lose about 50% of its planned second-quarter output, up from 17% in the first quarter. Ford now assumes that it will lose 10% of planned second-half 2021 production.

Earlier this month, the automaker reported that retail sales rose 57% in April from April 2020, which coincided with the pandemic, and 24% from April 2019, prior to the pandemic.

Taken together, retail truck and SUV sales were up 70%, "providing Ford Truck and SUV sales with their best April retail sales performance since 2006,” the company said.