German car giant Volkswagen and its subsidiary Audi said Thursday they would temporarily cut production and furlough workers as the auto industry suffers from a shortage of vital computer chips.

Volkswagen is sending roughly 8,800 employees at its plant in Emden, northern Germany, into short-time work until January 19, the carmaker told AFP in a statement. The plant produces VW's own-brand Passat model.

Luxury subsidiary Audi meanwhile is placing 10,000 employees on reduced hours until the end of January in Ingolstadt and Neckarsulm, both in the south of the country, the company told DPA news agency.

Semiconductor shortages have hampered auto production across the industry in recent weeks.

When car sales fell at the start of the COVID-19 crisis last spring, many chip manufacturers switched production to consumer electronics, which saw rising demand as the pandemic kept people at home.

The auto market has however since seen a rebound in sales, leading to critical bottlenecks in the supply chain.

Ford and Toyota said earlier this week they were slowing down or even stopping production at US factories due to the shortfall. 

"The limited supply of semiconductors due to rapidly recovering car markets is causing considerable disruptions in worldwide vehicle production across all manufacturers," VW said in the statement.

"Countermeasures and alternatives are continuously being examined in order to limit the effects of the supply bottleneck and thus the number of vehicles affected."

VW had already said on Wednesday it would stop production for several days at its main Wolfsburg site due to the shortage that affected its Tiguan and Touran models. 

(Cover: VCG)