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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

GOP Sen. Ben Sasse to introduce bill offering signing bonuses to new hires

Sen. Ben Sasse. Photo: Samuel Corum/AFP via Getty Images

Sen. Ben Sasse (R-Neb.) plans to introduce legislation this week to grant signing bonuses to new hires, he announced Tuesday.

Why it matters: The bonuses would replace expanded unemployment benefits and are aimed at boosting employment. Sasse called the numbers in the latest jobs report "crummy."

Prosecutor to seek hate crime charges, death penalty in Atlanta shootings

In Hopkinton, Mass., the Rally & Run To Stop Asian Hate is held to show solidarity in the wake of deadly Atlanta shootings and to mourn the loss of eight lives including six Asian women. Photo: Jonathan Wiggs/The Boston Globe via Getty Images

Prosecutors unveiled murder charges against the white man accused of shooting and killing eight people, six of whom were Asian women, at Atlanta-area spas,.AP reports.

Driving the news: A prosecutor filed notice that she plans to seek hate crime charges and the death penalty in the case.

3 hours ago - Health

Study: Over 99% of hospitalized COVID-19 patients were not vaccinated

Photo: Joe Raedle/Getty Images

The Cleveland Clinic on Tuesday released a study showing that 99.75% of patients hospitalized with COVID-19 between Jan. 1 and April 13 were not fully vaccinated, according to data provided to Axios.

Why it matters: Real-world evidence continues to show coronavirus vaccines are effective at keeping people from dying and out of hospitals. The Pfizer-BioNTech and Moderna vaccines have been found to be 95% and 94% effective, respectively, at preventing symptomatic infections.