Samsung, LG Plants Suffer in Vietnam COVID Surge

Korean companies like Samsung and LG are on edge amid a surge of coronavirus infections in Vietnam, where they have vital production facilities.

The Vietnamese government has imposed a draconian lockdown after daily infections surged from the single digits early this month to over 2,000.

Samsung was recently ordered by the Ho Chi Minh City government to seal its factory in the Saigon Hi-Tech Park and set up living quarters for staff on the premises, a company spokesman said Wednesday.

The municipal government decided to put the entire industrial park in total lockdown as 750 workers tested positive for coronavirus recently, including 48 at Samsung's factory.

Samsung continues to operate production lines while isolating patients in a separate facility.

Staff will be housed in a vast tent, but it will not be possible to accommodate all 7,000 of the workers, many of whom commute from nearby villages, so production is bound to suffer.

The factory in Ho Chi Minh has an annual capacity of 19 million TVs and other home appliances. Since completion in 2016 it has been Samsung's key production base in Southeast Asia.

Korean companies also have difficulty securing vaccines for their staff. Samsung and LG have donated W2.8 billion and W1.5 billion respectively to the Vietnamese government for the purchase of vaccines (US$1=W1,150). But LG subsidiaries like LG Electronics, LG Display and LG Innotek, which have their factories in the provinces, have been given almost no vaccines so far, although all of Samsung's staff have had at least their first shot.

"LG subsidiaries in Haiphong have to wait their turn because vaccines are being given chiefly to people in Ho Chi Minh and Hanoi, where mass infections have occurred," an LG staffer said.

"Korean companies are on high alert because it's possible that the local government will order them to shut down," an industry insider said. "They're preparing for disruption to their overseas supply networks just as in the early days of the pandemic."