With the arrival of the early summer heat wave, Vietnam is grappling with a serious power shortage that is severely impacting manufacturers who have poured into this Southeast Asian nation.
On Friday, local time, The Wall Street Journal cited local sources in Vietnam, reporting that some production bases of Apple suppliers such as Foxconn and Luxshare Precision, as well as Samsung Electronics' base in Northern Vietnam, have received notices from local power companies. They were asked to consider rotating power outages or, at the very least, reducing electricity usage during peak hours.
These sources disclosed that power supply tensions began in mid-May, and they were informed by the local government that the power shortage is expected to last at least until the end of June, for which they should prepare.
One informed source stated, "Over the past year, many electronics factories have expanded their production scales in this region, and power consumption has skyrocketed."
It's still unclear whether Apple's production has been affected. Recently, Apple has increased the production of tablets, laptops, and other devices in Vietnam.
According to Apple's most recent supplier list released this year, Foxconn and Luxshare Precision both manufacture on Apple's behalf in Bac Giang province in Vietnam. Besides competing with Apple in the smartphone market, a factory Samsung operates in Bac Ninh province also supplies parts to Apple.
Vietnamese local media state that the power shortage in Vietnam is due to dried up rivers and extreme heat.
As early as May, Vietnam's power companies warned that available power during peak hours might be reduced by 1.6 million to 4.9 million kilowatts in May, June, and July. On Wednesday, local media cited official estimates saying the worst-case scenario could see power supplies in the north cut by as much as 8 million kilowatts.
Informed sources revealed that the local government has asked some of Foxconn's manufacturing factories in Vietnam to consider suspending production from dusk to midnight for 20 days, but they are permitted to resume production from midnight until dawn. They stated that Vietnamese factories are currently trying to maintain most of their operations and are considering building their own power facilities next year.
A spokeswoman for Sumitomo Corporation, a Japanese trading company that operates industrial parks in Vietnam, said the company received a power outage notice from the Vietnamese power company over the weekend. Sumitomo stated that it is evaluating the notice with its tenants and considering implementing rotating power outages.
According to local media reports, rotating power outages have become part of daily life in Vietnam. Media quotes from a Ministry of Industry official stated that as of June 6, due to low water levels, the total hydroelectric power generation was less than a quarter of the designed capacity, and power generation has decreased by several thousand gigawatts.
