Suspended Operations For Malaysian Chip Factories, Tesla, Ford, Nissan Among Those Affected

Malaysia is the 7th largest semiconductor exporter in the world, and among the semiconductor factories in the country are Infineon, Intel, NXP, Texas Instruments and Renesas.

Regrettably, all of these factories received a major blow in the wake of the pandemic. Making things worse, the now rampant DELTA variant has increased the active cases to levels out of control.

For example, the outbreak at the STMicroelectronics factory, Tanjung Agas, Muar where hundreds of its 3,000 employees were infected with the COVID virus in which 19 of them died.

Kenanga Investment Bank Bhd.’s semiconductor analyst Samuel Tan said, the situation is quite worrying for companies like Infenion and others that own factories with the number of employees reaching thousands of people.

Manager of a Chinese autonomous driving company shared, the increase in COVID cases in Malaysia has caused major disruptions to our company’s chip supply.

Based on a study conducted by Susquehanna Financial Group, the time frame between a chip order is made and delivered is widening from eight days to more than 20 weeks.

“Malaysia is a major player in the global semiconductor trade,” said Malaysian Semiconductor Industry Association’s president Wong Siew Hai. “Therefore, any disruption anywhere along the supply chain will adversely affect elsewhere in the ecosystem.”

List Of Car Manufacturers Impacted By Chip Supply Issues In Malaysia

1. Nio and Tesla Electric Vehicles

Bosch China’s vice president Xu Daquan revealed that the temporary suspension of operations of the company supplying semiconductors in Johor has affected Bosch, which is also an important supplier to electric car manufacturers such as Nio and Tesla.

2. Ford

Ford Motor Co. informed that the company had to cease all productions of the F-150 pickup trucks at their plant in the U.S and also the Ford Fiesta at their plant in Germany. All due to the semiconductor supply problem from Malaysia caused by the pandemic.

3. Toyota

Toyota Motor Corp. stated last week that they will have to suspend the operations of 14 factories as supply companies in Southeast Asia such as Thailand, Vietnam and Malaysia are facing the DELTA variant outbreak.

4. Nissan Motor Co.

Nikkei Asia reports that automaker Nissan Motor Co. is expected to suspend operations of their plant in Tennessee, USA that produces EV Leaf cars until August 30, depending on the supply situation.

5. General Motors

Earlier this month, General Motors Co. suspended operations for a week at three of their truck manufacturing plants located in North America.

Impact Of Chip Supply Issues

The problem of chip shortages has caused the production volume of new cars to decrease. This however, indirectly shows an increase in the purchase of used cars.

Stated in the data released by the China Automobile Dealers Association, all transactions in China involving used cars reached 8.43 million in the first quarter of 2021.

This sees an increase of 52.9 percent from last year. Nevertheless, the supply issue is expected to continue until the first quarter of 2022.