Volkswagen’s Mexico unit says it will resume production that was hit by chip shortage

MEXICO CITY (Reuters) -Volkswagen AG’s Mexico unit said on Sunday it expects to restart production of three segments from next week and in July after output was curtailed by a global semiconductor chip supply crunch.

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Volkswagen Tiguan cars are pictured in a production line at company’s assembly plant in Puebla

“Volkswagen de México is preparing a return to activities for its three manufacturing segments,” the company said in a statement.

Automakers including General Motors Co, Ford Motor Co and Toyota Motor Corp have cut production this year due to the shortage of semiconductor chips, which was caused by factors including a rise in demand for electronic devices during the pandemic and fast recovery in auto markets.

Video: VW: chip shortage now at worst, will ease in Q3 (Reuters)

VW: chip shortage now at worst, will ease in Q3

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Volkswagen said there is a general expectation that the chip supply will improve in the second half but the company added that “possible future adjustments (to production) cannot be ruled out.”

Production of the Jetta, Taos and Tiguan models will be resumed separately and on different dates starting next week and during the month of July, Volkswagen said.

(Reporting by Anthony Esposito in Mexico CityWriting by Drazen JorgicEditing by Matthew Lewis)