Reference News Network, October 21 report: According to the website of the U.S. "Wall Street Journal", on October 19, a factory in Michigan, USA, which produces high-end sport utility vehicles (SUVs), had its production line stalled last week, and the resumption of production will be delayed until early next month.

A union official from the United Auto Workers said that the reason for the shutdown was an aluminum shortage.

For the same reason, Ford has suspended production at three factories. Due to the shutdown of two automakers, thousands of workers in Michigan and Kentucky are currently applying for unemployment benefits.

The automotive supply chain is a vast network of companies covering the globe, and it has once again come under the spotlight. The last time this happened was in the early 2020s, when a severe shortage of semiconductor chips severely hit the entire industry. Automotive industry executives often mention the lessons learned from that crisis: do not rely too much on a single supplier. But now, multiple parts have simultaneously faced supply issues.

Sam Fiorani, an analyst at the consulting firm Automotive Forecasting Solutions, said: "The simultaneous outbreak of these problems is a once-in-a-lifetime event. We have never seen such a situation before. The lessons from the semiconductor crisis should have prepared manufacturers for supply chain issues, but all the problems erupting at once is both unexpected and extremely difficult to handle."

Previously, the automotive industry had already struggled due to billions of dollars in tariff expenses and the high costs of transitioning to electric vehicles. Now, the shortage of parts has made things even worse. Last week, General Motors said that reducing its electric vehicle business would cost it $1.6 billion.

Data from S&P Global Mobility showed that U.S. car sales are expected to slightly exceed 15.9 million units in 2024 this year. However, the outlook for next year is not optimistic: due to increased pressure on automakers from tariffs and the high average price of cars (currently around $50,000), total production and sales of cars are expected to decline.

The White House imposed a high tariff of 25% on imported cars and parts. Subsequently, automakers urgently calculated costs, determined which models and locations to produce, and production activities thus came to a standstill.

Afterward, the Trump administration eased some tariff pressures and provided some relief for companies meeting the standards of the North American Free Trade Agreement, but this help was limited. From an industry-wide perspective, the costs caused by tariffs have exceeded $12 billion.

As a major target of Trump's global trade war, China has also not made the automotive manufacturing situation easier. In retaliation for the Trump administration's tariff policies, China cut off the supply of key rare earth minerals. Export restrictions forced automakers to find alternatives to maintain production. According to the "Wall Street Journal," some automakers even considered extreme measures, such as transporting engines made in the U.S. to China to install magnets.

In September this year, a third-level fire broke out at an aluminum plant in New York, causing production to be interrupted, with resumption of production expected until early next year. This shutdown disrupted Ford's production plans for several high-profit models, and now it has also affected the production of high-end Jeep SUVs. A spokesperson for Stellantis Group, the parent company of Jeep, stated that the shutdown of the Michigan factory was due to a shortage of parts, but did not specify the exact type of parts that were lacking.

At the same time, an odd and ongoing geopolitical dispute has made people more concerned about the possibility of global automotive production falling into chaos within a few weeks. (Translated by Yang Ke)

Original: https://www.toutiao.com/article/7563587044644078126/

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