The former capital of Vietnam - the country's largest city of Ho Chi Minh City - is preparing for a tough lockdown due to the situation with COVID-19. The new measures will prevent citizens from moving freely in the city and the surrounding area, and businesses will have to make do with fewer workers. As a result, Samsung's production capacity in the region is facing heavy losses.
The Samsung Electronics plant, located in Saigon Hi-Tech Park, produces smart TVs and home appliances for literally the whole world - Europe, Asia and the United States. In total, more than 7000 employees work here. Until recently, Samsung has been able to bypass restrictions by providing workers with sleeping places on the territory of the plant itself or in its immediate vicinity. Nevertheless, the enterprise operated at 30-40% of its capacity due to the restrictions already imposed.
A new decline in production will come at the most inopportune moment - the New Year season is not far off in a large part of the world, when sales are most active. In the event of a complete shutdown of the plant, Samsung will lose approximately $ 145 million a day.
Nevertheless, Samsung has some room for maneuver - it is possible that some compromise will be found with the Vietnamese authorities interested in investing - Samsung's plans to develop production in Vietnam and beyond are known . In addition, in the past, Samsung Display employees have already received permits to enter the country during severe restrictions, in an exceptional manner. For the most part, even the global shortage of semiconductors had little effect on the company's production, but a possible complete closure of a plant in Vietnam could change the situation.
The production of smartphones has not yet been affected, since the latter are produced at other sites. In addition, in the event of serious problems at the Vietnamese plant, there are additional capacities in the nearby regions. For example, enterprises in India will be able to compensate for the losses to some extent.
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