Global chip shortage might exacerbate due to new COVID-19 outbreak in Asia

A new report from The Wall Street Journal suggests the renewed outbreaks of COVID-19 in Asia could create delays in the global supply chain and exacerbate the global semiconductor shortage.

Powerhouse countries in terms of global chip production like Taiwan are currently experiencing a surge in COVID-19 cases. Yesterday, Taiwan’s Central Epidemic Command Center announced that there were 251 new confirmed cases of COVID-19 and 26 deaths while on Friday, the agency reported 287 new cases and 24 deaths. In Taiwan, Covid 19 cases have been on the rise since early May. South China Morning Post reported “Starting on May 10, COVID-19 infections jumped from one to three-digit figures within a matter of days.”

The Wall Street Journal reported, “At King Yuan Electronics Co., one of the island’s largest chip testing and packaging companies, more than 200 employees have tested positive for the virus this month, while another 2,000 workers have been placed in quarantine — cutting the company’s revenue this month by roughly a third.”

TSMC, Qualcomm, and many other big tech companies indicated that they were left unaffected but just back in April, the companies warned that chip shortages could last through 2022. As of now, it is unclear that how much toll it will take on Taiwan’s supply chain and manufacturing companies.

The WSJ also reported that manufacturing factories in Malaysia have slowed down there output due to COVID-19 outbreak. “All told, the Malaysia Semiconductor Industry Association says the lockdown will reduce output by between 15% and 40%.”

WSJ further reported that shipping centers in Asia have also been affected. The report referred to Yantian, a major container port in Shenzhen is at 30 percent of its normal activity.

Mary Woods
A news media professional with strong experience in online journalism, content management, and social media.