New York: A fire at a plant owned by Japanese chipmaker Renesas could exacerbate the continuing global shortage of semiconductors that have hampered car production in particular. The company, which makes chips for Toyota, Nissan and Honda, expects production at one of the buildings at its Naka plant in Hitachinaka to stop for a month. Shares in all three automakers fell between 2 percent and 3 percent on Monday.
Renesas, who is based in Tokyo, said the fire started when equipment overheated and ignited, although it was not known what caused it to overheat. There were no casualties or damage to the building. According to Renesas, two-thirds of the products manufactured in the building can be produced elsewhere, although the situation does not allow all products to be produced alternatively immediately, due to the recent increase in demand for semiconductors. “
Separately last week, Nissan said it was temporarily halting production at factories in Smyrna, Tennessee; Canton, Mississippi; and in Aguascalientes, Mexico, due to the shortage of chips. Volkswagen and Fiat Chrysler (now Stellantis) also say they have been hit by the shortage and have been forced to slow down production of some models to keep other factories running.
The scarcity of chips, coupled with a winter storm in February, also recently forced Ford to build F-150 pickups without computers. The company said the pickups will be kept at factories for a number of weeks and then shipped to dealers as soon as computers are available and the quality control done.
Industry officials say semiconductor companies have diverted production to consumer electronics in the worst of times Covid-19 slowdown in car sales last spring. Global car manufacturers are forced to close plants to prevent the spread of the virus. When car manufacturers recovered, there were not enough chips as the demand for personal electronics increased.
Source: Telangana Today