Xi’an, the former capital of the Middle Empire under several Chinese dynasties, and its 13 million inhabitants are confined for a week because of the resurgence of the Covid-19 pandemic. This new confinement threatens global memory production… Samsung produces 42.5% of its modules there.
Xi’an and its 13 million inhabitants sealed off
As the semiconductor shortage continues to hurt manufacturers around the world, another shortage could be about to see the light of day. Indeed, Xi’an is the “World capital” of the production of memory modules. This confinement could have a significant impact on the production of RAM and especially flash storage memory. Market leader, Samsung produces 42.5% of its NAND memory there (SSD flash memory) and Micron produces a large amount of its DRAM (random access memory) there.
Rivalry between China and the United States stimulates the development of new technologies
Just a few days ago, containment measures were becoming stricter for residents of Xi’an. They are now banned from leaving their homes and Chinese authorities have admitted having trouble supplying them with food… Logically, anger roars. It is very clear, the authorities are struggling to contain this new epidemic outbreak and are implementing their zero Covid policy, as during the first confinements. At the risk of create a new shortage in the field of data processing and technological objects.
Global memory production is threatened
Samsung alone accounts for 15.3% of the global production of this precious flash memory. Modules essential to the manufacture of smartphones, computers, tablets and even cars … Today, Micron and Samsung continue to produce ” normally “. Indeed, the two companies have enough stock to ensure production. However, the two manufacturers have already alerted the authorities that if the confinement were to last for several more days, a slowdown in their activities was to be expected, with the consequences that we now know.
In a current context of global shortage, this new crisis could be problematic for the manufacturers concerned. Some auto factories are already idling. This is the case in Europe where the automotive market is at its lowest, at the same level as sales generated in 1995. The semiconductor crisis and the growing computerization of automobiles have created an imbalance in the supply chain that risk of increasing, if the contaminations do not stop quickly in Xi’an.