Ford Motor Co. will begin shipping versions of its popular Explorer model minus the semiconductor chips needed to operate the SUV’s rear climate control system, a spokesman confirmed Sunday.
The move is the result of an ongoing shortage of semiconductor chips that has resulted in widespread disruption across the auto industry throughout the past year. Ford has lost production of hundreds of thousands and vehicles, leaving dealers with near-empty lots and customers waiting, at times for months, to take delivery of new vehicles.
The chips needed to operate rear seat control systems are in short supply, spokesman Said Deep told TheDetroitBureau.com, so, rather than waiting for fresh supplies, it will disable that functionality “to get Explorers out to customers faster.”
Feature can be retrofitted later
Motorists won’t entirely lose the ability to set the rear seat climate control. It will still be operable from up front, Deep explained. And the missing chip can be retrofitted later, he said adding, “When the part comes in we’ll install it at no cost to you.”
Ford plans to offer customers affected by the plan a credit on their purchase price, even if they have missing chip installed later. He did not have details on the size of that discount available.
The affected models are already in production and will begin to ship to dealers in the coming week, the spokesman noted.
Ford has company
This is the second time Ford has adjusted production to cope with the semiconductor shortage by deleting vehicle features. Late last year it offered F-150 customers the ability to speed up delivery if they agreed to delete the truck’s stop/start function.
That feature automatically shuts off the engine when idling in order to save fuel, restarting the powertrain when the driver’s foot lifts off the brake. In that case, however, Ford did not offer to later install the stop/start function.
Motorists who accepted the plan received a $50 credit.
Ford is by no means the only automaker struggling to work around the ongoing semiconductor shortage. General Motors briefly eliminated the heated seat function on some vehicles to get around the chip shortage, while some Cadillac Escalade SUVs were shipped without the hands-free Super Cruise function.
Nissan deleted the navigation function on some models. BMW also trimmed the functionality of some of its infotainment systems, in some cases disabling the AutoPark feature.
Chip shortage hits buyers, automakers alike
Global vehicle production fell millions short of initial industry estimates last year, costing manufacturers more than $200 billion in lost revenues, according to consultancy AlixPartners.
Ironically, most automakers actually saw earnings rise last year because ongoing dealer shortages allowed them to cut back on costly incentives, while dealers were less willing to bargain. Quite the contrary. A recent study by Edmunds found that 82.2% of U.S. new vehicle buyers paid more than the sticker price in January.
But there is growing pressure on automakers to start filling the dealer pipeline. Industry data shows retailers have barely 1 million new vehicles in inventory, less than a third of what is normal this time of year.