Chips Shortage Limits Auto Production in Brazil, Automakers Association Says

June 8, 2021 Updated: June 8, 2021

SAO PAULO—Automaker’s plants in Brazil have reached a “production ceiling” after the first five months of the year, below pre-pandemic levels, due to a shortage of computer chips, the South American nation’s automakers association said on Tuesday.

A semiconductor shortage has been affecting the production of chips and may reduce the global number of automobiles produced by 3 percent to 5 percent this year.

“We reached a plateau of 200,000 cars produced monthly in the first months of the year, due to the components shortage,” said Luiz Carlos Moraes, president of Brazil’s automakers association Anfavea. Moraes said he does not expect the components shortage to end until sometime in 2022.

Auto production rose 55 percent through May compared to the same period a year earlier. But the production of 981,500 units is well below the 1.24 million produced in the same period in 2019.

So far, Anfavea is maintaining its projections of 15 percent growth in auto sales this year and 25 percent growth in production.

In May, plants in Brazil produced 192,800 cars, trucks, and buses, 1 percent more than in April. Sales grew 7.7 percent to 188,700 vehicles. Exports grew 9 percent to 37,000.