Issues stemming from a global chip shortage are “very real,” US Vice President Kamala Harris said as she headed to Asia on a trip aimed at building trade relationships with countries seen as crucial to the supply chain.
Harris, who is visiting Singapore and Vietnam, where she is to emphasize the US’ role as a global leader, said on Friday that the country had an economic and security interest related to the region, and how dependent it is on its supply chains.
Her trip comes as a global semiconductor shortage continues to cause production delays for the auto and consumer electronics industries in the US.
Photo: Bloomberg
The administration of US President Joe Biden has for months engaged with industries and lawmakers on ways to alleviate the crisis, without much effect so far.
Harris yesterday landed in Singapore, which has sought to increase its chipmaking talent and manufacturing capability. US-based GlobalFoundries Inc recently said it planned to build a US$4 billion plant in the city-state, slated to start in 2023, and the facility is expected to primarily serve smartphone and auto demand.
Her second stop, tomorrow, would be Vietnam, which in particular plays an increasingly important role in many supply chains, as companies in the past few years moved operations there from China.
Intel Corp, one of the country’s biggest foreign investors, has spent 140 billion dong (US$6.1 million) in just one month to meet strict anti-COVID-19 mandates to ensure it can keep operations going in Ho Chi Minh City.
Harris said the semiconductor issue was also raised in a discussion with General Motors Co (GM) chief executive officer Mary Barra.
GM and other automakers have struggled to keep plants open due to shortfalls in chip supplies, which has forced them to limit production and see inventories dwindle.
This month, Barra told reporters that GM is working to prevent a recurrence of the shortfall and expressed confidence that the scramble for chips would ease — but did not provide any specific timeline.
Separately, German auto giant Volkswagen AG is to slash production at its main plant due to ongoing problems with the global supply of computer chips, a spokesman told Agence France-Presse on Friday.
Following the summer holidays for workers in Germany, work on the assembly line at the company’s facility in Wolfsburg would be “limited” and would have to “adapt to the supply situation,” the spokesman said.
Vehicles would only be produced during the early shift at the factory, while the rest of production would be halted, as shortages of semiconductors are set to continue, the automaker said.
The renewed scarcity is in part the result of “outbreaks of COVID-19, particularly in Malaysia, which have led to factory closures for semiconductor producers,” Volkswagen said.
Earlier last week, the Volkswagen-owned auto brand Audi also said that it would be delaying the resumption of production on some of its lines in Germany due to the “volatile” supply situation.
That came after Japanese company Toyota Motor Corp, the world’s largest automaker, on Thursday announced that it would be reducing production next month by 40 percent, in part due to a “parts shortage resulting from the spread of COVID-19 in Southeast Asia,” it said.
Additional reporting by AFP
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