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Ford to provide update on financial impact of chip shortage next month

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DETROIT -Ford Motor Co said on Wednesday, while announcing the latest production cuts in North America at seven assembly plants due to the global chip shortage, that it would provide an update on April 28 on the success expected from its 2021 profit.

The US automaker previously said its operating profit this year would be reduced from US $ 1 billion to US $ 2.5 billion. The update to this forecast will be provided when Ford releases its first quarter results on April 28. A spokesperson declined to comment.

U.S. rival General Motors Co previously said its 2021 profit could be slashed by as much as $ 2 billion due to the chip shortage.

Earlier Wednesday, GM Chief Financial Officer Paul Jacobson, speaking at a Bank of America conference, said he still feels comfortable with the company’s 2021 profit forecast despite the shortage of chips. GM said in February that, including the chip hit, it expected to earn US $ 4.50 to US $ 5.25 per share this year.

The chip shortage came when North American auto factories were closed for two months during the COVID-19 pandemic last year and chip orders were canceled, and demand increased from the consumer electronics industry as people worked from home and played video games. This has now left automakers competing for chips.

Semiconductors are widely used in cars, including to monitor engine performance, manage steering or automatic windows, and in sensors used in parking and entertainment systems.

(Reporting by Ben Klayman in Detroit, editing by Leslie Adler and Matthew Lewis)

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