The cold weather hitting Mexico and the southern U.S. is causing disruptions to the server supply chain.
According to a report from DigiTimes, Foxconn, Inventec and Wiwynn all have production lines in Juarez, Mexico, and some of these companies are planning to expand capacity or establish surface mount technology (SMT) production lines at the sites.
The severe weather caused mass power outages because roughly 60% of Mexico’s power is generated using natural gas that comes from Texas. As a result, the production lines of these original design manufacturers (ODMs) were affected, disrupting server production.
While the power has been restored, delivery of server shipments is still being impacted by local transportation as it is hard for anything to be delivered on snowy or icy roads. Some clients have been able to ship directly from the Mexico plants, but datacenters in Texas have been unable to obtain shipments until conditions improve.
According to the DigiTimes report, delays will catch up in March with global server shipments still tracking double-digit growth in 2021. This will improve when Intel and AMD release their next generation server platforms, which is expected to happen soon.
