On July 6, ON Semiconductor issued a notice to its customers, sales representatives and distributors regarding the temporary closure of its factory in Seremban, Negeri Sembilan, Malaysia.
ON Semiconductor stated in the notice that due to a surge in COVID-19 cases, the Malaysian government and its agencies have now increased restrictive measures for the public and businesses in most districts of Selangor and Kuala Lumpur to contain the virus.
ON Semiconducotr stated that as part of the Enhanced Movement Control order, the Malasian government put in places as of July 3, 2021, the Ministry of Health authorities enacted the shutdown of its Seremban factory for 14 days, ending on July 17. The government’s objective is to stop gathering and movement of people in a region to significantly slow down the spread of the virus in the community.
The notice pointed out that the latest action causes significant impact to capacityr utilization for probe, Assembly & Test at Seremban as well as Assembly as Amkor.
ON Semiconductor started an appeal escalation with the state government leadership with the goal to at least shorten the shutdown period to fewer than the current 14 days. They also continue to work with the American Malaysian Chamber of Commerce and Malaysia Semiconductor Industry Association to reiterate the importance of Malaysia to the global semiconductor supply chain and that their operations constitute an essential business.
According to the supply chain, the current lead time of ON Semiconductor's discrete devices generally reaches more than 26 weeks, among which MOSFET and IGBT takes 26 to 52 weeks, and some logic ICs and image sensor chips take 50 weeks. The temporary closure of the factory is expected to further extend the lead time of some products.