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Supply Chain
CHONGQING ORDERS FACTORIES TO SHUT TO SAVE POWER DURING HEAT WAVE
Surge in electricity demand forces Chinese city to rein in usage
Chongqing Changan Automobile is one of the factories suspending production until
Aug. 24 to comply with government orders.
SHUNSUKE TABETA, Nikkei staff writerAugust 17, 2022 20:37 JST | China
CopyCopied
CHONGQING -- The Chongqing municipal government has ordered factories, including
Japanese-owned ones, to suspend operations until Aug. 24 to conserve energy
after an exceptionally hot spell led to a surge in electricity demand.
Following in the footsteps of neighboring Sichuan Province, Chongqing is
controlling power usage in the Liangjiang area, and others, after extreme heat
led to a huge increase in the use of fans and air conditioners. Chongqing has a
high number of factories that make automobiles and computers, and their shutdown
could have an impact on supplies domestically and internationally. Shopping
centers, including foreign-owned ones, will also shorten operating hours.
Previously, the government had only required that factories cease production
during consumption peaks, but the tight power supply-demand situation has become
so severe that shutdowns were deemed necessary. Local authorities said that many
areas in Chongqing have been experiencing high temperatures of over 40 C.
Chongqing is home to many auto manufacturers, including state-owned Chongqing
Changan Automobile and U.S.-based Ford Motor. BYD also has its battery plant
there, as well as Taiwanese electronics manufacturers that produce equipment for
U.S. tech companies.
Many Japanese companies have also moved into the area, with Isuzu Motors and
Honda as well as auto parts manufacturers setting up plants there.
Meanwhile, Sichuan Province, which has procured much of its power in the past,
is also experiencing a serious power shortage.
Authorities there had ordered most factories to halt production until Aug. 20.
This includes the production facilities of Hon Hai Precision Industry, which is
a key Apple supplier, and Toyota Motor's factory. According to Chinese media,
power shortages are also occurring in Zhejiang and Jiangsu provinces.
READ NEXT
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APPLE WARNS SUPPLIERS TO FOLLOW CHINA RULES ON 'TAIWAN' LABELING
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BEIJING AND SHANGHAI FACE BLACKOUTS IN DEEPENING POWER CRUNCH
Economy
TAIWAN HIT BY TRIPLE BLOW OF DROUGHT, BLACKOUTS AND COVID SURGE
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PAKISTAN BLACKOUTS CHOKE ECONOMY AS CHINA POWER PLANTS GO UNPAID
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XINJIANG COTTON CROP AT RISK OF FLOODING CAUSED BY EXTREME WEATHER
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