Renesas Fire Threatens Global Chip Supply
Japanese firm, Renesas Electronics, a major automotive semiconductor supplier, has warned that a fire at one of its factories could severely impact global semiconductor supplies and force a month-long halt in production.
For car makers already tackling supply chain disruptions due to the Covid-19 pandemic and severe storms in Texas, the timing of the fire at the advanced chip plant could not be worse.
“We are concerned that there will be a massive impact on chip supplies,” Hidetoshi Shibata, Renesas Chief Executive, said earlier this week. “We will pursue every means possible to minimise the impact.”
The fire started in one of the factory's clean rooms in Naka city, north of Tokyo, halting the production of 300mm wafers and damaging about 2% of the facility's manufacturing equipment.
However, two thirds of the chips affected by the fire can be produced elsewhere, thanks to the firm's efforts to diversify its supply chain following the 2011 Tohoku earthquake and tsunami, which affected the production of Renesas microcontrollers.
Nevertheless, Shibata admitted that sourcing alternative facilities to produce its chips would be difficult, considering the industry is struggling with a lack of spare production capacity at factories such as Taiwan’s TSMC, the world’s largest contract chipmaker.
to address the global chip shortage, Renesas had increased production, moving some of the semiconductors outsourced to TSMC to the line that was destroyed by the fire. The firm has been struggling to meet the rise in demand, after a rebound in car sales coincided with a boom in the consumer electronics market.