Daimler cuts production as chip shortage bites

BERLIN -- Daimler is extending reduced working schedules at Mercedes-Benz factories in Germany and Hungary as the global shortage of semiconductors continues to impact automakers.

Volkswagen also said this week it will extend production cutbacks at three German plants into September due to a lack of chips.

Daimler will halt production next week at its German factories in Bremen and Rastatt and in Kecskemet, Hungary, the German News Agency (dpa) reported on Friday.

Output will be reduced at the automaker's home plant in Sindelfingen, Germany.

More than 12,000 people are employed at the Bremen plant, about 6,500 in Rastatt, about 4,700 in Kecskemet and 25,000 in Sindelfingen.

The C-Class and the GLC SUV are built in Bremen, the B-Class in Kecskemet and the A-Class in Rastatt. Sindelfingen produces the S-Class sedan, E-Class and EQS full-electric sedan.

Production at the four locations had been subject to repeated stops in recent months due to problems with the supply of electronic chips.

Production at Sindelfingen is expected to be least affected as Daimler concentrates on protecting output of the highly profitable models built there.

VW is extending production cutbacks in Germany due to a lack of semiconductors, a spokesman told the dpa earlier this week.

The automaker's home plant in Wolfsburg, which builds the Golf hatchback among other models, will operate on only one shift per production line until Sept. 5.

Plants in Zwickau and Dresden will also operate at reduced capacity, the spokesman said.

The chip crisis also forced Volvo to idle its Gothenburg plant for the week of Aug. 30 to Sept. 3.

Stellantis recently had to halt output at French car plants in Rennes and Sochaux, while last week Ford was forced cut output again at its Cologne plant due to chip shortages.