Hua Hong’s Sudden Power Outage to Suspend Production of Components

Hua Hong Semiconductor's third and fifth factories in Shanghai suffered an explosion due to a short circuit in the transformer in the distribution station. The production lines of both factories are currently affected and suspended.

A combination of tougher emissions standards, coal supply shortages, and increased demand from manufacturers have sent coal prices sky-high in China. Due to this, China has had to halt production at multiple factory sites—including sites used to supply Apple and Tesla—to curb energy usage and ensure that residents in North China have enough energy to remain warm during nights that now approach freezing temperatures.

Hua Hong Semiconductor’s (HKG) wafer fab in Shanghai reported a power outage (January 8). Industry sources revealed that the accident was caused by a short circuit in the transformer in the distribution station, causing an explosion and power outage. As Hua Hong Factory No. 3 and Factory No. 5 share the power distribution station, both factories are temporarily unable to operate.

Generally speaking, in order to prevent sudden power outages, fabs are equipped with large UPS uninterruptible power supply equipment and diesel generators for emergency power supply. In the event of a sudden power failure, the UPS can support the power supply for about ten minutes, allowing the crew to start the backup generator to ensure the continuous production line, and more importantly, to protect the precious equipment from damage.

However, according to Chinese media reports, Hua Hong insiders pointed out that the accident was serious. Not only did all the machines in Hua Hong’s third factory shut down, but even the UPS of the fifth factory’s lithography machine could not support it, and it has not yet resumed operation.

Because the wafer manufacturing process is quite long, a power outage not only puts the wafer in production at risk of being scrapped, but it can also take up to several days to resume operation after the equipment is shut down.

Hua Hong's third plant has a 90-nanometer process, mainly producing power semiconductor chips, with a monthly production capacity of 53,000 8-inch wafers. Hua Hong Factory 5 is the group's first fully automatic smart production line and the first 12-inch wafer foundry production line, with a monthly production capacity of 45,000 wafers and a manufacturing process ranging from 55 to 28 nm. Downstream customers include almost all electronic product.

If the power outage and shutdown of the two factories are as serious as the sources said, it will make the chip supply problem worse.

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