Heat wave continues in China’s Sichuan province China is already jeopardizing chip manufacturing within its borders, but it is also threatening the lives of Chinese citizens.Severity of the heat wave has led to a surge in air conditioning use and higher average temperatures from an average of 30 degrees Celsius in August Towards 40 degrees Celsius with dry low humidity. A sudden and unexpected surge in electricity demand and record low rainfall are proving inadequate supplies of water to feed Sichuan’s hydroelectric power plants, further aggravating the situation. A heat wave that pushed temperatures to their highest in 60 years exacerbated the shortage, with local newspapers dubbing the situation a “double scarcity.”
result: Some factories in this area have closed To prioritize survival over production.
Intel is just one of the regional manufacturers that has stopped production at its facilities. All high-output, high-energy-consuming factories in Sichuan’s Saigon Hi-Tech Park have been shut down to free up power to combat rising temperatures. Foxconn, Volkswagen, Onsemi, Tesla and Toyota plants will remain closed until at least August 20th.
Intel maintains two fabs, CD1 and CD6, in Chengdu, Sichuan. These fabs include manufacturing, production, assembly, testing and distribution facilities as well as warehouses, office space and parking lots.Plant CD1 and CD6 alone are approximately 240 million kWh of electricity and 900,000 cubic meters of fresh water through 2021These numbers may help give an overview of the amount of resources consumed by the two Intel facilities.
The company had previously planned to spend $1.6 billion on additional manufacturing plants in the region, but pressure from the White House has prevented it from getting off the ground.
It remains to be seen what the actual impact of the production shutdown will have on the semiconductor market itself (besides other businesses affected). Foxconn is one of the most important suppliers in the technology sector, providing manufacturing and assembly services to numerous motherboard suppliers and consumer technology giant Apple.
The shutdown of two high-volume manufacturing facilities could create problems with the availability and, in turn, pricing of Intel products. Two days may not seem like much, but semiconductor manufacturing and assembly is a very delicate task. Losses may have already occurred due to the stoppage of the assembly line. Also, we have no way of knowing if the halted production will continue beyond his August 20th. As always, time will tell.
