- Ford beat Wall Street's expectations for the first quarter, but said it expects the chip shortage to decrease its earnings by $2.5 billion in 2021, the high end of its previous guidance for the year.
- The company said Wednesday it now expects to lose about 50% of its planned second-quarter production, up from 17% in the first quarter.
- The increase is largely due to a fire at a chip supplier for Ford in Japan, according to the automaker.
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Ford CEO Jim Farley takes off his mask at the Ford Built for America event at Fords Dearborn Truck Plant on September 17, 2020 in Dearborn, Michigan.Nic Antaya | Getty Images
The company said Wednesday it now expects to lose about 50% of its planned second-quarter production, up from 17% in the first quarter. The increase is largely due to a fire at chip supplier Renesas Electronics for Ford and other automakers in Japan, according to the automaker.
"There are more whitewater moments ahead for us that we have to navigate," Farley told investors during the company's first-quarter earnings call. "The semiconductor shortage and the impact to production will get worse before it gets better."
Ford CFO John Lawler provided some optimism regarding the situation, saying the company believes that the semiconductor issue will bottom out during the second quarter, with improvement through the remainder of the year.