Ford’s U.S. gross sales continued to get better from chip scarcity in October

Bronco SUVs in production at the Ford Michigan plant, June 14, 2021.

Michael Wayland | CNBC

DETROIT – Ford engine US vehicle sales showed positive signs of recovery from a persistent shortage of semiconductor chips that devastated the global auto industry this year.

The Detroit-based automaker reported sales of 175,918 new vehicles in October on Wednesday, a 4% year-over-year decline but a far smaller loss than in previous months. The sales are Ford’s best since April and the first time since May that the company hasn’t reported a double digital monthly loss compared to 2020.

“In June of this year, Ford retail sales grew 10.7%. With limited inventory and record turnaround rates in the second quarter, we worked closely with our dealers to collect retail orders that were up 16x year over year, ”said Andrew Frick, Ford vice president of sales in the US and Canada .

On another positive note, Ford said vehicle inventories did that were at record lows due to the shortage of chips increased by 7,000 units compared to the previous month to 243,000 cars and trucks.

Ford’s sales outperformed the industry last month, according to Cox Automotive. The auto research firm estimated on Wednesday that new car sales in the US were down about 21% compared to October 2020. That’s better than Cox’s original forecast of a 30% decline.

“The market is still experiencing very low inventory levels and correspondingly low incentives, but the worst is probably behind us,” Cox said in a press release.

Ford is one of a handful of automakers that report new vehicle sales every month. Others like General Motors and Stellantis (formerly Fiat Chrysler) only report quarterly sales.

Ford’s October sales come a week after the business Wall Street earnings expectations nearly doubled for the third quarter and increased its adjusted earnings guidance for the full year from $ 9-10 billion to $ 10.5-11.5 billion.

However, Ford is not yet clear about its semiconductor chip offering. CFO John Lawler said last week the company expects the chip shortage to continue into next year and possibly to a far lesser extent into 2023.

According to Lawler, Ford expects wholesale vehicle volume to grow 10% in 2022 compared to this year as semiconductor shortages continue to affect business.

Chip scarcity will hit electrical automotive manufacturing

An ES6 electric SUV from Nio Inc. at a battery swap station in a parking lot in Shanghai on March 1, 2021.

Qilai Shen | Bloomberg | Getty Images

BEIJING – Chinese electric car launch Nio said Tuesday a global chip shortage will force it to make fewer cars in the second quarter.

The high demand for electronics amid the coronavirus pandemic and the pressure of US-China trade tensions on the highly specialized semiconductor supply chain have contributed to an increase Chip manufacturing backlog.

Large automakers had to cut production As a result, Nio, based in China, announced such cuts at the latest.

The company had increased production capacity to 10,000 vehicles per month in February, an increase from 7,500 previously, founder William Li said in a quarterly earnings call on Tuesday. However, a shortage of chips and batteries means Nio will have to fall back to the 7,500 level in the second quarter, he said.

Nio predicts strong deliveries

Despite competition from Tesla, Nio stayed ahead of its start-up competitors in vehicle sales.

The company delivered 7,225 vehicles in January and 5,578 vehicles in February during the weeklong New Year holiday. With a forecast of 20,000 to 25,000 deliveries in the first quarter, Nio assumes that deliveries in March will increase to at least 7,197 vehicles.

In contrast, Xpeng said Tuesday it delivered 2,223 electric cars in the last month while Li car expect it will deliver fewer than 4,000 cars per month in the first quarter.

Nio founder Li said pre-orders for the et7 sedan unveiled in January have outperformed those of the company’s other models but refused to share certain numbers. The et7 is Nio’s first non-SUV consumer car and is scheduled to begin deliveries next year.

Li added the company had stayed on track plans to enter Europe later this year.

Nio’s shares, listed on the New York Stock Exchange, fell 4% in trading for extended periods after a fourth quarter earnings loss of 0.93 yuan (14 cents) per share was reported. That is more than the analysts’ forecast loss of 0.39 yuan per share, according to FactSet.

The company attributed a quarterly increase in net losses of nearly 33% to 1.39 billion yuan ($ 212.8 million) for the final three months of 2020, mainly due to the depreciation of the US dollar.

The Nio share rose more than 1,000% in the past year after the difficult start received approximately $ 1 billion in capital injection from government-backed investors and traders who have piled into the stock alongside a surge in Tesla shares.

For the future, Nio expects total sales of 7.38 billion yuan to 7.56 billion yuan in the first quarter after 6.64 billion yuan in the fourth quarter.

Don’t Waste Your Cash: Laptop Chip Scarcity

Posted: Feb 17, 2021 / 10:41 PM EST
Updated: February 17, 2021 / 10:41 PM EST

Remember how Sony PlayStations weren’t to be found during the holidays but should be plentiful by now?

That did not happen, and the main problem causing these bottlenecks is now other bottlenecks as well.

Can’t find a PS5 or new Xbox? Sony now blames a massive global chip shortage.

No, not casino or potato chips, but computer chips.

According to CNBC, a shortage of semiconductor chips is slowing the production of all types of electronics, even automobiles.

GM, Ford, Honda and Fiat Chrysler are reported to be slowing production of some models because they cannot get computer chips for their onboard displays and other electronics.

Of the major automakers, only Toyota says it has not yet been affected as it has stocked up on chips in advance.

According to CNBC, an unexpected surge in electronics sales last summer caused its suppliers to run out. Consumers bought laptops and desktops, new phones, big screen televisions and game consoles.

Nobody foresaw the pandemic, but this really stinks.

Sony says it won’t be able to ramp up PlayStation production until the chip shortage subsides, and the hunt continues.

Cramer calls on U.S. to fund vegetation to handle chip scarcity, unemployment

CNBC’s Jim Cramer said Wednesday the United States should fund the development of a chip maker to address both the high unemployment rate in the country and a chip shortage that affects American businesses.

More and more companies, including automakers, like ford and General Motorsrecently raised the alarm about global supply of components, which led them to cut back on production of their own products.

Meanwhile, the US job market is struggling to get out of the coronavirus-induced recession with an unemployment rate of 6.3%.

“We need more chips and we need more jobs,” said Cramer on “Bad money. “” Why not kill two birds with one stone? It is time for our government to invest in building the largest and best complex of semiconductor foundries in the world. “

Automobiles are getting more technological, which requires silicon chips for things like power steering, brake sensors, and entertainment devices. The Supply bottlenecks forced GM and Ford to close factories, delaying new car deliveries. GM warned the disruption could affect its 2021 goals.

The demand for chips, which are also used in products such as televisions, game consoles, and computers, increased during the pandemic as Americans switched to remote work and study environments. Cramer also blamed globalization, which enabled companies to outsource manufacturing to giants like them Taiwan Semiconductor and Samsung Electronics in Asia.

The more connected cars become, the more semiconductors they will need.

“Believe me, you will hear about this shortage every day because it is devastating all kinds of industries, making us a much less competitive and perhaps even a hostage company. Hostage to a larger chip customer, the PRC. We have to Be one step ahead of that, “said Cramer.

“Our companies cannot get enough chips because there is not enough production in the world, and this shortage of chips affects all types of manufacturing,” he added.

He signaled that he was optimistic about Gina Raimondo, the governor of Rhode Island who was named head of the US Department of Commerce by President Joe Biden. Raimondo is a former venture capitalist who gives her an ideal perspective on the business world, Cramer said.

He also said the low interest rate environment can be a catalyst to fund the federal project with bonds.

“America’s best tech industry, the most intellectual property there is in technology, is in semiconductor capital goods,” said Cramer, referring to companies like Lam Research, KLA Tenor and Applied Materials, which make machines for making chips need.

“Building gigantic semiconductor foundries enables more people to work than any other infrastructure project.”

Disclosure: Cramer’s charitable foundation owns shares in Ford.

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