Case IH-New Holland Parent Company Forced to Idle Production in EU Due to Shortage of Semiconductors
From John Deere workers going on strike, to agricultural equipment manufacturers idling manufacturing sites, the supply chain issues are intensifying within agriculture.
CNH Industrial, an Italian-American tractor and vehicle maker, announced this week its temporarily shutting several of its European manufacturing plants that produce agricultural equipment. The idling of plants is also also cutting off production of commercial vehicles and powertrain facilities. CNH manufacturers Case IH, Steyer, New Holland and IVECO equipment.
CNH says it plans to shut down the facilities for eight days this month. The company indicated the shutdowns are driven by getting components to build and construct the machines, including semiconductors.
The supply chain issues are crippling manufacturers. CNH Industrial's CEO Scott Wine called the situation "brutal" during an interview with Farm Journal this month.
"The team has done a really nice job managing through it. I mean, it's brutal. It's the most difficult supply chain situation I’ve seen," said Wine. "I was a supply officer in the Navy before I joined the industrial world. So I've been around much of it in all my life. I've never seen it this bad. But the team's done a nice job of managing through it."
The Association of Equipment Manufacturers (AEM) says the issue isn't just something hitting one particular equipment manufacturer. instead, the issue is industry-wide.
"The supply chain issues that are facing the ag equipment market are the same ones that are facing cars, and washing machines and pen balls, and whatever, whatever else that you're trying to buy. Everything is in tight supply," Curt blades, AEM Senior VP of Ag Services, told Clinton Griffiths. "So, you think about that sort of supply disruption along with some pretty solid demand. It's a it's it's a recipe for empty lots out there. But that's not necessarily a bad thing. But it is a it is a thing. And it is a little bit different than maybe what we're used to see in the ag market, and certainly on some of those dealer lots and across rural America."
Blades told Griffiths that some manufactures are even chartering their own flights to get the parts they need, which adds to the cost of the goods.
The issue with sourcing semiconducters is plaguing everything from farm equipment to trucks. And CNH says from sourcing semiconductors to other parts, it's an issue adding to the cost of manufacturing goods today.
"There's just shortages. We've been building all year products without all the parts so they have to come back when the parts come in, and we finish them up and ship them out," he told Farm Journal. "Lately the semiconductor issue has really started to impact us because a lot of the chip assembly work is done in Malaysia and some of our, some of our key engine component suppliers were relying on those chips and we just can't get them. So it's a brutal world, but we're managing through it. But it's not easy and not cheap."
