Honda may cut production amid microchip shortage – Automotive News Europe

TOKYO — Honda could halt production in Japan due to a global shortage of automotive microchips.

The automaker plans to reduce domestic output by 4,000 units in January, a slowdown mainly affecting the Fit small hatchback at Honda’s Suzuka plant, the Nikkei newspaper reported on Friday.

The bottleneck might result in the loss of tens of thousands of units through March for Honda, the report said. The cause is a tight supplies of computer chips for cars.

A Honda spokeswoman said the company is aware of the industrywide microchip shortage and is considering countermeasures. But it is too soon for Honda to say when the company might announce any output adjustments or how many vehicles might be impacted, she said.

Automakers and suppliers first sounded the alarm about potential supply chain problems last month, warning that it may hit auto production in the first quarter of 2021.

Global makers of semiconductors scaled back output during the pandemic lockdowns of early 2020. But now, these manufacturers are slow to catch up to demand that is rapidly ramping back up.

A massive fire in October at a chip plant owned by Asahi Kasei Microdevices, a unit of Asahi Kasei in southern Japan, has also damaged semiconductor supply.

Fueling the shortage is soaring demand for chips in digital devices such as phones and computers, which is diverting deliveries away from automotive customers.

Among those already warning of interruptions are Volkswagen Group and suppliers Bosch and Continental. Other automakers, including General Motors, have said