Kia to again suspend U.S. plant over chip shortage

May 24, 2021

Kia Corp., South Korea’s No. 2 carmaker, plans to suspend its factory in the United States for two days later this week due to a semiconductor shortage, company officials said Monday.

Kia plans to idle its assembly line in Georgia from Thursday to Friday over a chip shortage, following its two-day factory suspension last month, they said.

The Georgia plant, which produces the Telluride, Sorento SUV and K5 sedan, rolled out 70,600 units in the first three months of this year.

Kia halted production of its domestic factory in Gwangmyeong, west of Seoul, for two days last week due to the same problem, joining other automakers that were forced to cut back on production earlier this year.

In a conference call on the first-quarter earnings results last month, Kia executives said an extended chip shortage will have an impact on the carmaker’s second-quarter bottom line.

Chances are high that the carmakers will continue to suspend their plants in the current quarter, as it takes time for their overseas chip suppliers to resume production following natural disasters and fires.