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

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.

"Volkswagen de Mexico 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.

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.