Chip hiccups as China’s Xi’an lockdown hits semiconductor players
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China has sent its major industrial hub Xi’an into lockdown as the city reports its highest daily COVID-19 cases in nearly two years.
A total of 162 new community infections were reported on Monday causing the city of 13 million to stay home as part of China’s ‘Zero COVID’ approach.
And two of the world’s biggest chipmakers – Samsung and Micron – have already said they’ve adjusted their businesses in the city.
It’s bad news for the ongoing global chip crisis which was projected to potentially ease up by mid-2022.
SUPPLY CHAINS | ANOTHER SEMICONDUCTOR WARNING
Samsung and Micron Technology, two of the world’s largest memory chip makers, warned that strict COVID-19 curbs in the Chinese city of Xian could disrupt their chip manufacturing bases in the area.https://t.co/quHfWEjQN8
— Nikkei Asia (@NikkeiAsia) December 30, 2021
Micron said in a statement that the city’s closure has reduced the company’s team and contractor workforce on site, “resulting in some impact to output levels of our DRAM assembly and test operations there.”
“We are working with suppliers operating in this region that face similar challenges,” the company said.
“We are also working with local government officials to identify solutions that will enable us to minimize impact of the situation and maintain operations at the site safely.
“We are tapping our global supply chain, including our subcontractor partners, to help service our customers for these DRAM products.
“We project that these efforts will allow us to meet most of our customer demand, however there may be some near-term delays as we activate our network.”
While Micron noted that new or more stringent restrictions in Xi’an would be difficult to mitigate, it’s working with customers, suppliers, and logistics partners to miminise any impact to delivery schedules.
Samsung has also temporarily adjusted operations at its manufacturing facilities in Xi’an.
However, the company didn’t say what material impact this will have, or when it might resume normal operations.
“This decision was made in accordance with our commitment to protecting the health and safety of our employees and partners, which remains our top priority,” Samsung said.
“We will also take all necessary measures, including leveraging our global manufacturing network, to ensure that our customers are not affected.”
Earlier this month the company announced it had kicked off mass production of cutting-edge automotive memory solutions designed for next-generation autonomous electric vehicles.