South Korea to exempt auto chip buyers from Covid-19 quarantine, provide vaccines

Seoul tries to limit the damage from a chip shortage plaguing global automakers and forcing production cuts worldwide

SEOUL:

South Korea said on Wednesday it will exempt business people working to secure supply of auto chips from two-week Covid-19 quarantine requirements and prioritise the vaccination of people key to auto chip procurement.

The move comes as South Korea tries to limit the damage from a chip shortage that has plagued global automakers and forced production cuts worldwide, including at Volkswagen and General Motors. Germany and the United States have also ramped up efforts to resolve the shortage.

South Korea’s leading automaker Hyundai Motor has so far kept factories running, but a Hyundai union official told Reuters on Tuesday that overtime production of less-popular models had stopped and production schedules were changing from week to week.

Although the domestic auto industry’s situation was good compared to international rivals, “concerns about future production disruptions have increased”, the government said in a statement.

Read: South Korea vaccinates 18,000 to start ambitious Covid-19 campaign

Chip production capacity could not be increased quickly, with 98% of auto chips used by South Korean automakers coming from abroad, it added.

To help deal with the shortage, Koreans and foreigners involved in auto chip imports or production would no longer have to quarantine for two weeks on arrival in the country from abroad, starting April.

Covid-19 vaccinations would be available for people departing for essential purposes such as purchasing and procuring auto chips.

The government also said it would speed up performance evaluations of auto chip components and modules developed by domestic companies.