Global Sources
EE Times-Asia
Stay in touch with EE Times Asia
?
EE Times-Asia > Manufacturing/Packaging
?
?
Manufacturing/Packaging??

Japan quake raises concerns over electronics supply chain

Posted: 16 Mar 2011 ?? ?Print Version ?Bookmark and Share

Keywords:wafer fabs? northeast Japan? electronics supply? chip vendors? fab tool vendors?

Both government and company officials have yet to confirm the state of several wafer fabs located in the prefectures closest to the powerful earthquake and tsunami that struck northeast Japan last Friday.

During earthquakes, factories, which are built to withstand them, normally suffer little damage and at most incur loss of work in progress. However, the 8.9-magnitude tremor may have been too strong to leave the factories undamaged. The devastation is so massive that it may take many days to restore electricity and water supplies, and transportation links.

Aside from being a significant manufacturer of chips, Japan holds a key position in the semiconductor equipment and materials supply chain, which could have a bearing on chip manufacturing factory operations in the rest of the world. Japan is a major player in LCDs, solar and other products.

According to market research firm IHS iSuppli, Japanese suppliers accounted for more than one fifth of global semiconductor production in 2010. Japan also accounted for 16.5 percent of global CE equipment factory revenue and 6.2 percent of the world's production of large-sized LCD panels in 2010. Japan also accounts for a very high share of components used in LCD panels and LCD-based products, including glass, color filters, polarizers, cold cathode fluorescent lamps and LEDs, according to IHS iSuppli.

Needless to say, Japan is critical to the worldwide electronics supply chain. ''Over 40 percent of the world's NAND flash and roughly 15 percent of the world's DRAM are manufactured in Japan,'' said Jim Handy, an analyst with Objective-Analysis.

''Japan is a significant source of chips to support CE devices. A two-week shutdown would remove from production a sizable share of each of these. It doesn't take a large production decrease to cause prices to increase dramatically. Objective Analysis anticipates phenomenal price swings and large near-term shortages as a result of this earthquake,'' Handy said.

''Demand will be impacted as well since many electronics manufacturers are in Japan, and their consumption of semiconductors will be halted until earthquake damage is repaired,'' he said.

''The biggest current problem in Japan is that the transportation network is down and that there were power outages. Fabs that don't have backup power and lost power, even if the transportation network was up, will be down for half to a full week. The other problem is that tool suppliers are in the same situation as emergency rooms in these natural disasters. Service resources are limited, and that constrains a recovery,'' said G. Dan Hutcheson, CEO of VLSI Research Inc.

Japan has many chip and fab tool vendors. Tokyo Electron Ltd (TEL) has a plant in Miyagi. Nikon Inc., a leading supplier of lithography equipment, has manufacturing operations in Sendai and in Katta-gun, Miyagi prefecture. Miyagi Nikon Precision Co. Ltd makes components for inclusion in LCD and IC steppers. A prolonged interruption there could impact the current strong sales of equipment and slow down expansion of global chip manufacturing capacity during 2011.

Japan fabs

Shin-etsu, a leading supplier of silicon wafers, does not have any major manufacturing plants in the north of Japan but does have a number of factories in the Gunma region northwest of Tokyo.

Meanwhile, at least two U.S. chipmakers were impacted. Texas Instruments Inc.'s Miho and Aizu sites and its Tokyo offices were affected by the initial magnitude 8.9 earthquake, according to TI. Employees at these sites were evacuated, and no injuries were reported. A fourth TI site in Hiji was not affected. TI has about 2,100 employees in Japan. No other details were given.

TI also has a fab in Aizu. TI recently bought the fab from Spansion Inc. Following the devastating earthquakes and tsunami in Japan, TI initiated support of American Red Cross relief efforts. The Texas Instruments Foundation has announced contributions of as much as $250,000 for the American Red Cross Japan Earthquake and Pacific Tsunami Fund. A $100,000 donation will be made initially, with another contribution of as much as $150,000 to match employee and retiree gifts through May 15, 2011.


1???2???3?Next Page?Last Page



Article Comments - Japan quake raises concerns over ele...
Comments:??
*? You can enter [0] more charecters.
*Verify code:
?
?
Webinars

Seminars

Visit Asia Webinars to learn about the latest in technology and get practical design tips.

?
?
Back to Top