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Samsung Electronics cuts chip production in Xian due to lockdown

Samsung Electronics chip plant in Xian. (Samsung Electronics)
Samsung Electronics chip plant in Xian. (Samsung Electronics)
Samsung Electronics reduced chip production in Xian where Chinese authorities placed a strict lockdown last week to contain the prolonged pandemic.

According to Samsung Newsroom Thursday, the South Korean IT giant “decided to temporarily adjust operations” at its chip factory in Xian.

The decision was made to protect the health and safety of its employees and partners, according to the press release. To ensure its customers are not affected, the company will take all necessary measures, including leveraging its global manufacturing network.

The Xian facility, which has been running since 2014, is Samsung Electronics’ only overseas memory chip factory. The Xian plant accounts for roughly 40 percent of Samsung Electronics’ NAND flash chips.

When the Chinese authorities enforced a lockdown in Xian on Dec. 22, Samsung Electronics went into an emergency mode. By putting all available personnel on the production line, the factory managed to stay fully operational.

“Due to the lockdown, there are difficulties in employees’ commutes and logistics, so it was inevitable to adjust operations,” a company official said. “When the lockdown is lifted, operations will be normalized.”

Meanwhile, Samsung SDI, which runs an electric vehicle battery factory in China, seems unaffected by the lockdown.

“Samsung SDI will respond in accordance with the authorities’ guidelines but (the factory) is in normal operations,” a company official said. Samsung SDI’s Xian factory was formed by a three-way joint venture between Anqing Ring New Group and Xian Gaoke Group.

By Kim Byung-wook (kbw@heraldcorp.com)
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