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Illustration: Aïda Amer/Axios

A global chip shortage has forced virtually every major automaker to halt some car production and furlough workers — just as the industry was showing signs of recovery from the pandemic-related shutdowns last spring.

Why it matters: Fewer chips, fewer cars. Semiconductors are crucial components that make computer-controlled systems in cars work — everything from engines to power windows, as well as driver-assistance and navigation features.

What's going on: Automakers needed fewer chips when the pandemic forced them to halt production. Chipmakers curbed production then ramped back up, though they still can't meet the industry's abrupt demand rebound.

  • Not helping: A tension long in the making. Chip appetite from the tech industry has been surging. But it skyrocketed when the pandemic supercharged appetite for electronics that need chips to operate.

The list of chip shortage victims keeps growing: Ford is the latest, slashing production of its top money-making F-150 pickup trucks because of the limited supply of the key auto component.

  • The company is bracing for a big hit: “Right now, estimates from [chip] suppliers could suggest losing 10% to 20% of our planned first-quarter production," Ford CFO John Lawler said yesterday. That could translate into lost profits of $1 billion to $2.5 billion for 2021, he said.

The company joins General Motors, Nissan, Volkswagen, Toyota, Mazda and Subaru in cutting production output — all citing the semiconductor shortage.

By the numbers: The problem will result in nearly 700,000 fewer vehicles produced globally this quarter alone, according to new research from IHS Markit. It also said the problem might not let up until Q3.

  • Alix Partners says the lost revenue could be as much as $61 billion this year, per Bloomberg.

Between the lines: Major semiconductor suppliers, such as Taiwan-based Semiconductor Manufacturing Company (TSMC) and United Microelectronics Corporation (UMC) say they are investing to expand production, but that will take time.

  • The problem has caught Washington's attention, with more than a dozen senators calling on the White House to support additional funding to expand chip production in the U.S.

The bottom line: "Automakers cutting production now because of a chip supply bottleneck will cause a cascade of issues throughout the supply chain," Sam Abuelsamid, an analyst at Guidehouse Insights, tells Axios.

  • "Not only will the automakers be cutting production, so will all of their suppliers. This will be very costly throughout the industry."

Go deeper: Why Intel's chip troubles should concern us all

Go deeper

Huge wildfire reaches edge of Sequoia National Park

A plume of smoke and flames rise into the air as the fire burns towards Moro Rock during the KNP Complex fire in the Sequoia National Park near Three Rivers, California, on Saturday. Photo: Patrick T. Fallon/AFP via Getty Images

Firefighters in Sequoia National Park were working into the night after two wildfires merged to reach the Giant Forest Saturday.

Why it matters: This forest contains over 2,000 giant sequoias, including the General Sherman Tree — considered the world's largest by volume. Park officials wrapped the trees in foil last week as the Paradise and Colony Fires, now known as the KNP Complex Fire, neared. And officials said early Sunday protection efforts appeared to be working.

2 hours ago - World

U.S. drone strike victims' families in Afghanistan seek compensation

A relative of Ezmarai Ahmadi, who was killed by a U.S. drone strike, looks at the wreckage of a vehicle that was damaged in the strike in the Kwaja Burga neighbourhood of Kabul on Saturday. Photo: Hoshang Hashimi AFP via Getty Images

Relatives of 10 Afghans killed by a U.S. drone strike in Kabul last month said Saturday they want to see punishment and compensation over the deaths.

Driving the news: The relatives said it's "good news" that the U.S. had "officially admitted" that "they had attacked innocents" in the Aug. 29 strike that killed Zamarai Ahmadi, an aid worker with a U.S.-based group, and nine family members, but they still need "justice," per AFP.

Miriam Kramer, author of Space
6 hours ago - Science

All-civilian Inspiration4 is back on Earth after flight to space

A side-by-side of the Inspiration4 crew and a shot of their capsule on the way back to Earth. Photo: SpaceX

The all-civilian Inspiration4 crew is back on Earth after their three-day mission in orbit.

The big picture: The launch and landing of this fully amateur, private space crew marks a changing of the guard from spaceflight being a largely government-led venture to being under the purview of private companies.