Tenn. Nissan plant to close for 2 weeks due to chip shortage

Aug 10, 2021, 12:55 AM | Updated: 3:33 pm
FILE - In this Feb. 8, 2012, file photo, vehicles are reflected on the logo of the Nissan Motors Co...

FILE - In this Feb. 8, 2012, file photo, vehicles are reflected on the logo of the Nissan Motors Co. at a showroom in Tokyo's Ginza shopping district. Nissan says its huge factory in Smyrna, Tennessee, will close for two weeks starting Monday, Aug. 16, 2021 due to computer chip shortages brought on by a coronavirus outbreak in Malaysia. (AP Photo/Shizuo Kambayashi, File)

(AP Photo/Shizuo Kambayashi, File)

DETROIT (AP) — Nissan says its huge factory in Smyrna, Tennessee, will close for two weeks starting Monday due to computer chip shortages brought on by a coronavirus outbreak in Malaysia.

The shutdown is among the longest at any U.S. auto plant of this size since the semiconductor shortage, which has hobbled auto production worldwide, started to hit late last year.

Nissan said Tuesday that it ran short of chips due to a COVID-19 outbreak at a chip factory in Malaysia. It expects production to resume Aug. 30.

The 6 million-square-foot Tennessee factory employs 6,700 people and makes six Nissan models, including the Rogue small SUV, the company’s top-selling U.S. vehicle.

Analysts say the closure of the large Nissan factory for two weeks is a sign that the semiconductor shortage may not be coming to an end late this year as many auto executives had hoped.

Few U.S. factories have been down for two weeks in a row, and they usually are plants that make lower-volume, less-profitable vehicles, such as sedans. Automakers have tried to conserve chips for plants that make their top sellers, largely SUVs and pickup trucks. But pickup truck plants have been shut down sporadically as well, including three General Motors factories this week.

Guidehouse Research Principal Analyst Sam Abuelsamid said Smyrna is a crucial factory for Nissan and its shutdown is a sign that the end of the semiconductor shortage may not be in sight.

“It’s looking like it’s going to stretch at least into the new year,” he said.

With continuing COVID-19 outbreaks across the semiconductor supply chain in Asia and other regions, supply problems may last even longer than that, Abuelsamid said.

The shortage and plant closures, coupled with strong consumer demand in the U.S., have caused shortages of new vehicles across the nation. That has driven up prices, and the shortage has spilled into the market for used vehicles.

The chip shortage is starting to improve, but the coronavirus delta variant is starting to cause problems at factories in the semiconductor supply chain, making matters worse, said Phil Amsrud, senior principal analyst for IHS Markit who studies the chip market.

Large chip foundries in Taiwan and elsewhere in Asia take large silicon wafers and turn them into multiple smaller integrated circuits. They’re then shipped to “back end” manufacturers in Malaysia where they are cut into chips that are used in automotive control computers.

But outbreaks among workers in those factories, and in the shipping business, are affecting supplies again, as evidenced by the Nissan shutdown, Amsrud said. Also, chips that automakers are getting now may not be the right ones for products they want to build in the future, he said.

In addition, many countries that do the back-end work like Malaysia have low vaccination rates, Amsrud noted.

“It looks to me like we’re just set up for delta getting a foothold in all of these locations,” he said. “I think delta is going to still cause us all sorts of problems.”

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Associated Press

Police: Washington officer shot, wounded while making arrest

Pasco Police in southeast Washington state said one of their officers was shot and wounded Thursday afternoon while making an arrest.
16 hours ago
State hospital...
Associated Press

7 die from flu in Washington state, activity ‘very high’

Flu activity in the state is now considered very high, according to the Washington State Department of Health.
16 hours ago
Associated Press

Mamie King-Chalmers, woman in civil rights photo, dies at 81

DETROIT (AP) — Mamie King-Chalmers, who as a young Black woman appeared in an iconic photo about civil rights struggles in Alabama, has died at the age of 81. She died Tuesday in Detroit, her home since the 1970s, daughter Lasuria Allman said. A cause wasn’t disclosed. King-Chalmers, 21 at the time, was one of […]
16 hours ago
Associated Press

Guest lineups for the Sunday news shows

WASHINGTON (AP) — ABC’s “This Week” — Reps. Hakeem Jeffries, D-N.Y., and Dave Joyce, R-Ohio; Sam Bankman-Fried, founder and former CEO of cryptocurrency exchange FTX. __ NBC’s “Meet the Press” — Israeli Prime Minister-designate Benjamin Netanyahu; Rep. Katherine Clark, D-Mass. __ CBS’ “Face the Nation” — Secretary of State Antony Blinken; Reps. Pete Aguilar, D-Calif., […]
16 hours ago
Rev. Paula Stecker of the Christ the King Lutheran Church tidies up a memorial outside Club Q follo...
Associated Press

EXPLAINER: What do we know about the Colorado bomb threat?

DENVER (AP) — More than a year before police say Anderson Lee Aldrich killed five people and wounded 17 others at a gay night club in Colorado Springs, Aldrich was arrested on allegations of making a bomb threat that led to the evacuation of about 10 homes. Aldrich, who uses the pronoun they and is […]
16 hours ago
Pennsylvania state House of Representatives' impeachment managers Reps. Craig Williams, left, Tim B...
Associated Press

Philly prosecutor sues to stop lawmakers from removing him

HARRISBURG, Pa. (AP) — Philadelphia’s elected prosecutor asked a state court Friday to halt a Republican-led effort to remove him from office, arguing that the process ended when the Legislature’s two-year session ran out earlier in the week. District Attorney Larry Krasner, a Democrat, wants Commonwealth Court to declare that the General Assembly lacks constitutional […]
16 hours ago

Sponsored Articles

Comcast Ready for Business Fund...
Ilona Lohrey | President and CEO, GSBA

GSBA is closing the disparity gap with Ready for Business Fund

GSBA, Comcast, and other partners are working to address disparities in access to financial resources with the Ready for Business fund.

Medicare open enrollment is here and SHIBA can help!

The SHIBA program – part of the Office of the Insurance Commissioner – is ready to help with your Medicare open enrollment decisions.
Lake Washington Windows...

Choosing Best Windows for Your Home

Lake Washington Windows and Doors is a local window dealer offering the exclusive Leak Armor installation.
Anacortes Christmas Tree...

Come one, come all! Food, Drink, and Coastal Christmas – Anacortes has it all!

Come celebrate Anacortes’ 11th annual Bier on the Pier! Bier on the Pier takes place on October 7th and 8th and features local ciders, food trucks and live music - not to mention the beautiful views of the Guemes Channel and backdrop of downtown Anacortes.
Swedish Cyberknife Treatment...

The revolutionary treatment of Swedish CyberKnife provides better quality of life for majority of patients

There are a wide variety of treatments options available for men with prostate cancer. One of the most technologically advanced treatment options in the Pacific Northwest is Stereotactic Body Radiation Therapy using the CyberKnife platform at Swedish Medical Center.
Work at Zum Services...

Seattle Public Schools announces three-year contract with Zum

Seattle Public Schools just announced a three-year contract with a brand-new company to the Pacific Northwest to assist with their student transportation: Zum.
Tenn. Nissan plant to close for 2 weeks due to chip shortage