As the epidemic spreads around the world and strict control measures have been taken by governments in various countries, the importance of the semiconductor industry is highlighting due to its basic and supporting role. For example, the Semiconductor Association of America (SIA) has previously called on the government to include semiconductors in basic necessary industries and continue to operate to ensure supply to various industries around the world.
's concerns about the impact of the epidemic have triggered turmoil in global stock markets, and the semiconductor industry has not been spared. In addition, many industry associations and analysts have also pointed out recently that the industry's recovery trend may be reversed. However, at least from the stock price, things seem to be starting to turn around after spending the "longest March".
Since April, the stock price of Micron Technology (Micron) has risen by 15.6%; during the same period, the Philadelphia Semiconductor Index (SOX) rose by 12.2%, and the Nasdaq Index rose by 10.8%.
As a semiconductor manufacturer that occupies an important share of the global storage field, Micron has also taken a series of necessary measures earlier to deal with the impact of the epidemic. According to the data statistics from TrendForce Consulting in the fourth quarter of 2019, the company occupied 22.3% of the global dynamic random storage (DRAM) market, and the NAND flash market share also reached 11.3%.
Take Micron's Xi'an factory as an example. The factory is mainly responsible for testing and packaging business. It is an important part of Micron's global supply chain and one of its largest DRAM back-road production bases in the world. Zhu Wenju, vice president of Micron Technology and general manager of Micron Xi'an, told a reporter from 21st Century Business Herald on April 8 that while the epidemic has achieved "zero impact" on production capacity, the Xi'an factory also hit a new high in the latest fiscal quarter, sharing the pressure on production capacity for other factories around the world of Micron.
( Micron Technology Vice President and Micron Xi'an General Manager)
Initiate prevention and control measures as soon as possible
Micron's results in response to the epidemic depend to a certain extent on its early adoption of prevention and control measures. According to local media in the United States, the company began providing protective supplies to employees in many places in Asia on January 23, and began to conduct temperature checks on employees in the region on the same day.
When I realized in early February that some degree of impact was inevitable, Micron tried the "Red Team Blue Team" approach at its Asian factory to let teams with the same skills work separately. This plant team isolation mechanism can reduce the impact on production efficiency once an infection occurs, while also reducing the range of virus transmission. In addition, Micron also requires team members to work from home as much as possible and control the number of people in the factory area; the remote control center as a backup plan has also been prepared in all factories.
In the Xi'an factory, in addition to the more conventional means of requiring employees to wear masks, check their body temperature multiple times, and strengthening the frequency and range of disinfection, Micron has also increased the frequency of employees' dining and dining in groups; in addition, it has also increased the route and station of shuttle buses.
"Micon has deployed strict prevention and control measures in all offices in China, such as health screening, suspension of all business travel, higher standards of disinfection and sanitation measures, and provides employees with protective supplies such as masks." Zhu Wenju said in the interview, "No 3,700 team members in China were infected, which provides the necessary conditions for resumption of work and production."
During the Spring Festival, when the epidemic situation in China is still severe, Micron obtained a continuous production license from the local government, and normal production and operation continued, and the production efficiency reached 100%. At the same time, the Xi'an factory also provides employees with provincial shuttle buses and temporary hotel accommodation to help employees return to work. In March, the factory's resumption rate reached 100%, achieving the goal of "zero impact" on production capacity.
ensures the stability of the supply chain
In addition to the direct impact of the epidemic on factory employees, its impact on the semiconductor supply chain has also attracted attention in recent times. Like factory prevention and control, Micron also made an early arrangement to respond to the epidemic from the perspective of industrial chain .
According to previous reports by local media, Micron's management completed a relevant investigation into the industrial chain at the end of January to confirm potential supply chain risks.For example, the company began to stockpile key materials such as silicon wafers and special chemicals needed for production, for example.
Nowadays, with the development of the epidemic, although the sluggish market in smartphones and other markets has led to a weakening of demand for some storage products, the demand for online office, online shopping and streaming media generated by the epidemic has greatly stimulated the surge in demand for data centers.
" (Micon) further consolidates and flexibly global manufacturing, supply chain and logistics network to ensure the supply and production operation of raw materials and ensure the continuous and stable supply of customers." Zhu Wenju said.
She summarized Micron's measures into three points: "Using the flexibility of the global supply chain system to ensure the stable supply of raw materials", "improving the inventory level of raw materials and avoiding logistics risks" and "multiple supplier strategies to reduce risks". At the same time, she also emphasized that a stable supply of raw materials is also one of the important reasons to ensure the normal production and operation of the Xi'an factory.
However, Zhu Wenju also admitted that the current global epidemic situation has forced many countries to take measures to control personnel flow, which has brought certain challenges to the business activities of small and medium-sized suppliers, which may lead to cash flow tightness in some companies.
"Global, as one of the measures to jointly fight the epidemic, Micron is accelerating the payment to small enterprise suppliers to help them alleviate short-term cash flow difficulties." When talking about local suppliers in China, she further emphasized: "Micro has worked with the local government to assist many supporting enterprises in the industrial chain to resume work and production."
promised to "no layoffs" and issue epidemic subsidies to employees
Before, Micron's management had made a promise that it would not implement layoffs within the next 90 days.
htmlOn March 25, after releasing a second-quarter financial report for fiscal year 2020 that overall outperformed Wall Street's expectations, Micron further stated that it plans to invest $35 million to provide financial assistance to various personnel affected by the new crown pneumonia. This includes launching a new $10 million bailout fund from the Micron Foundation, increasing employee matching and providing financial support to team members through grants.Specifically, Micron will issue a one-time subsidy for the new crown epidemic, and a subsidy of $1,000 to all U.S. employees with annual income less than $100,000; at the same time, it will also issue an appropriate proportion of subsidy to eligible employees in other countries and regions around the world.
Zhu Wenju told reporters that whether it is full-time, part-time employees or interns, as long as the annual salary is below the local standard, it is within the scope of the payment of the subsidy; therefore, about 68% of employees around the world are listed as the targets of distribution. In China, about 81.7% of employees can receive a one-time COVID-19 subsidy of 2,500 yuan in April.
Previously, Micron has also made epidemic-related donations in China, including a donation of 1 million yuan from the Micron Foundation and an additional 300,000 yuan raised by the Chinese team through the company's donation plan. In addition, Micron's Xi'an factory also donated protective supplies to local health organizations and community agencies in Shaanxi in February.
"When China's epidemic prevention materials were in short supply in February, Micron's headquarters urgently coordinated local inventory from factories in Singapore and the United States, and transported important epidemic prevention materials such as masks to China." Zhu Wenju introduced.
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