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There has been a massive snow disaster in Texas, which can have severe repercussions on (un) availability and more expensive hardware. Due to blackouts, the NXP, Infineon and Samsung chip factories had to be shut down.
As if the effects of the coronavirus pandemic and, in part, the now re-awakened gold rushes around the cryptocurrencies, which made various computer components (including components for their production) poorly available, were not enough, another complication has now been added: extreme weather (perhaps eventually associated with climate change) has now decommissioned several chip factories in the US, including Samsung.
What exactly happened? In the USA, heavy snowfall and blizzards, associated with low temperatures and icing, have spread over much of the territory. It has also hit Texas in the relatively south, and this harsh weather is still going to last for some time. The accompanying phenomenon of this calamity is outages in the supply of electricity, because the snow supply decommissioned various distribution facilities, but probably also power plants. Directly in Texas, there was probably not much snow or frost for our conditions, but the infrastructure was probably not ready.
And this situation seems to have hit particularly hard in Texas, where gigawatts of power plant power have fallen out (reportedly up to 18,500 MW) and the situation is critical (the mayor of Austin allegedly called on residents to light flashlights and candles for the investigation, even if they have power; 200,000 people were or are completely without electricity). Texas has its own separate distribution network, which makes it impossible to cover outages from less affected parts of the United States. Because a lack of energy for lighting, heating, and cooking could be very dangerous to the population in the winter, according to recent reports, the Texas electricity distributor has called (or immediately instructed) some major industrial companies to reduce and then stop production.
And that’s what hit the chip factories in Texas. First of all, it is Samsung’s factory in Austin, where it is confirmed that the order has been respected and the factory has been shut down. But it’s not just Samsung, it’s also the production lines for NXP and Infineon chips. These companies also confirmed that they had to stop production.
A huge number of chips may be missing due to downtime
This can potentially be a big problem, even if the forced downtime was only for a few days. The production of chips has many stages, through which one batch in the factory gradually goes through several weeks. Therefore, production cannot always be restarted quickly. The worst case is sudden unexpected power outages, when the loss of control of the environment usually leads to contamination of unfinished wafers and often the amount of products that have been in various stages of distribution is degraded and must be discarded.
Tip: Another blow for SSD prices. A short power outage eliminated 3.5% of world NAND production
It’s a bit of a situation, like a processor making erroneous speculation and having to drop the instructions calculated so far and start over. In addition to depreciated wafers, it takes several weeks for newly started products to reach the end of the production chain and be ready. Because of this, downtime can be a big problem. Let’s hope that the controlled shutdown did not cause any damage to the wafers on which the lines worked and somehow managed to preserve them for later resumption of operation. If not, the production outage will be much greater than would correspond to the length of the outage.
Samsung has a 14nm factory, but…
And that would be another blow in the current situation, when there is a shortage of various components and hardware, it has been waiting for a long time and / or it is overpriced, which could make everything worse. Samsung manufactures GPU Ampere for Nvidia, which are in short supply, so now there is probably increasing pressure on those interested in graphics. Fortunately, the good news is: the Austin plant has only a 14nm process (and probably its 12LPP and 11LPP derivatives). The outage will therefore affect the production of various mainly cheaper mobile SoCs, but perhaps also the GPU Nvidia of the older generation Pascal (in GeForce GTX 1050 Ti cards, which now the company seems to be sending back to the market, and then in the GT 1030, which is often the only available card – so far?). However, the question is whether this GPU was manufactured in Texas or Korea.
Potentially, Samsung could respond to the US outage by shifting some of its Korean factory capacity to products manufactured by a 14nm to 11nm process, and then the availability of the 8nm process for the Nvidia GPU could deteriorate. But the influence would be more indirect, so there is probably a very good chance that this will not damage the production of GeForce cards.
Lack of previously overlooked components can have a domino effect
However, it could probably be affected by the shutdown of Infineon. It manufactures, among other things, power supply components (MOSFETs / Power Stages) for VRM or power cascades of motherboards, laptops and graphics cards. According to industry sources, these are just one of the components that are in short supply and whose unavailability is due to the lack of manufactured graphics cards. Thus, the Infineon problem in Texas can lead to more expensive and (even more) worsened availability of many other hardware. Infineon’s factory originally belonged to Cypress Semiconductor, so it could produce other chips (including specialized memories) than VRM, but I don’t know if the focus has changed in the meantime.
In the case of the NXP factories (the frost and snow stopped two lines at once), the outage could mean problems for automakers, for example, because this is an area where this chip manufacturer is well represented. Coincidentally, the automotive industry is already in trouble anyway, because it does not have a number of specific chips (allegedly contributed to the situation by the fact that many of them were produced due to cheap prices in Chinese company SMIC, but suddenly gave up a number of orders).
It has gone so far that statesmen and large automakers have negotiated with the TSMC to produce chips that are vital to the automotive industry as a matter of priority, thus avoiding the domino effect of bleeding many other metal-related industries (those on wheels). However, this means that when cars get capacity, the production of chips can be postponed, which in turn need our tin boxes without wheels, but with RGB LEDs.
It is possible that in addition to these confirmed industrial victims (unfortunately, the weather in the USA should have dozens of human victims) other chip production could also be affected. It also manufactures Applied Materials, Qorvo, Flex and Texas Instruments in Texas (surprisingly).
If we are particularly unlucky, then this seemingly insignificant report could ultimately have effects on a perhaps smaller scale reminiscent of Thai floods of 2011which led to HDD apocalypse, which many people remember, and from which the hard disk market did not recover for a long time (respectively, the prices of disks did not recover for a long time, the evolution in the price per gigabyte was delayed for many years). But let’s hope it doesn’t be so bad now, and in the end this snow disaster won’t make the availability of hardware worse dramatically.
Resources: Financial Times, ExtremeTech
