Czech Skoda Cars to Halt Production Until Year-End Due to Semiconductor Shortage

[Asia Economy Reporter Yujin Cho] Czech Skoda Auto, with a 126-year history, has decided to halt factory production until the end of the year due to the global chip shortage. As the semiconductor supply shortage prolongs, major global automakers continue to face disruptions, repeatedly suspending operations and reducing output.

Skoda Auto, under the Volkswagen Group, will reduce its production by 250,000 units compared to its target this year, Bloomberg reported on the 17th (local time).

This is more than double the production cut forecast made in September. In September, Skoda CEO Thomas Sch?fer announced plans to reduce production by 100,000 units compared to the original target for this year.

Skoda plans to suspend factory operations until the end of this year due to the semiconductor shortage. The Skoda labor union stated that due to the chip shortage, unfinished inventory is overflowing, leading to the decision to stop shift work at the factory until the end of the year. Skoda expects the chip shortage situation to continue until the second half of next year.

Skoda's suspension appears to be a result of the semiconductor chip shortage caused by the closure of Southeast Asian factories, which serve as a post-processing hub for semiconductor chips. Previously, mass-market brands with high production volumes such as Volkswagen and Japan's Toyota, as well as luxury car brands like Mercedes-Benz and Land Rover, have recently halted their production lines.

Founded in December 1895, Skoda is the largest automaker in the Czech Republic and has a tradition spanning over 100 years alongside brands like Tatra, Peugeot, and Opel. Headquartered in Mlad? Boleslav, Czech Republic, Skoda originally focused on the Eastern European market but expanded its sales channels to Western Europe and overseas markets after being acquired by Volkswagen in 1991, emphasizing mid-to-low priced lines.