Mercedes cuts production on chip shortages

Daimler is reducing Mercedes-Benz production at three plants in Germany and temporarily halting output in its factory in Hungary due to the semiconductor shortage.

The automaker has introduced short-time working for employees at the Mercedes plants in Sindelfingen, Rastatt and Bremen in Germany.

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In Rastatt, production will be reduced until the end of next week. In Sindelfingen and Bremen, output will be cut until the end of the week.

The Kecskemet factory will stop production for three weeks until mid-August.

Daimler said it could not give a prognosis about when the supply shortage of certain semiconductor components will be cleared.

"The situation is still volatile and we are permanently reevaluating what this means for Mercedes-Benz production," a Daimler spokeswoman admitted.

In Sindelfingen, production has only been stopped in some areas and the automaker will continue to build as normal highly profitable large luxury cars. At Sindelfingen's factory, which builds the S-Class sedan, Mercedes-Maybach S-Class and the EQS full-electric sedan, production is not impacted.

“The Mercedes-EQ electric offensive remains a top priority,” the spokeswoman concluded.

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Earlier this year, Daimler revealed that the semiconductor shortage had a negative impact on deliveries in the first quarter of this year and was likely to further impact sales in the second quarter. A leading analyst in the field further confirmed that the effects of this crisis would be seen over the course of 2022’s production cycle.

Earlier this month, BMW stated that the crisis was reaching a critical stage with it having lost output of around 30 000 units so far this year, with more to follow as production was still being halted at various factories around the world.

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