© Reuters. FILE PHOTO: A researcher plants a semiconductor on an interface board during a research work to design and develop a semiconductor product at Tsinghua Unigroup research centre in Beijing, China, February 29, 2016. REUTERS/Kim Kyung-Hoon/File Photo
(Reuters) -British parts supplier Melrose’s automotive clients are cancelling orders at 25 times the rate seen earlier this year, it said on Tuesday, as the auto industry remains engulfed in a global chip shortage caused by the pandemic.
The owner of GKN (LON:), which supplies parts to carmakers such as Volkswagen (DE:), said the “in-month” cancellation from automotive customers has risen to about 20% to 25% from a normal 1% rate seen during the January-March period.
“Tightened supply of semiconductors to the automotive industry are frustrating and difficult to plan for, but whilst they affect current trading, they don’t impact long-term value, particularly as cash is well controlled and debt reduced,” Chief