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Austin-based NXP Semiconductor likely to lose $100 million because of Texas grid collapse

·1 min read

Austin-based NXP Semiconductor said it would likely lose $100 million thanks to a month-long shutdown in the wake of Texas' cold-weather-driven electricity-grid collapse, the Austin American-Statesman reports.

Why it matters: A global chip shortage — stemming from pandemic-related supply-chain disruptions and climate-change-related disasters — has hobbled U.S. auto manufacturing and could threaten the vigor of a post-pandemic economic recovery.

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  • NXP's Austin plants are back online, but Samsung's have not resumed full production.

  • In Taiwan, a major center for semiconductor production, a drought tied to climate change is threatening chip production, which depends on an abundant supply of water.

  • An analysis at Seeking Alpha suggests that big tech companies like Apple have more experience at planning for long-term chip needs and have locked in their supplies whereas the auto industry, with its "just-in-time" production philosophy, may have a harder time.

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