Hyundai Motor suspends U.S. factory production due to chip shortage

According to foreign media reports, Hyundai Motor Group, South Korea's leading automaker, said on June 14 that its production facilities in the United States have been suspended due to a shortage of automotive semiconductors.

The company said in a statement, "Hyundai Motor Company's plant in Alabama, USA will suspend operations for five days from June 14, but this decision will only affect Hyundai's car assembly line." Hyundai's sister company Kia's plant in Georgia, USA, which produces car engines, will continue to operate. During the shutdown, Hyundai will carry out factory maintenance and is expected to resume full production from June 21.

Hyundai's Alabama assembly plant in Montgomery, which makes the Sonata and Elantra sedans and Santa Fe SUVs, will invest more than $400 million to expand the plant to produce a small pickup truck, the Santa Cruz.

Hyundai added, “Yes, we have no plans to produce vehicles at our Alabama plant this year. However, this does not mean that the plant will be completely shut down as some production lines will continue to operate. Hyundai will provide support measures for employees affected by the suspension of production, and we plan to resume normal operations at the plant after the summer vacation.”

Semiconductor chip shortages are also continuing to take a toll on Hyundai Motor's South Korean plants. The company also said it would suspend production of the Sonata and Grandeur sedans at its Asan plant south of Seoul, after previously suspending operations from April 12 to April 13, April 19 to April 20, and May 24 to May 26 due to chip shortages.

Lee Jae-il, an auto analyst at Eugene Investment, said, "Hyundai Motor is planning to readjust its automotive chip supply chain to purchase more chips from factories in other countries to help fill production disruptions caused by chip shortages. But the company will have to lower its production target for this year."

An executive at South Korea's top semiconductor company believes the chip supply situation will return to normal from the fourth quarter of this year.