Technology industry assesses Japanese earthquake damage

The Japanese earthquake has seen supply chains suffering in the technology industry, with prices predicted to rise.

When the earthquake hit on Friday we reported that several plants including Sony and Toshiba were closed, while internet cables and mobile phone networks were damaged. However, more damage is coming to light.

Firstly comes predictions that there will be a shortage in silicon wafer chips and battery prices will rise in the interim. The wafer shortage comes as a result of the earthquake disrupting production at silicon wafer supplier Shin-Etsu Handotai (SEH).

According to Digitimes SEH’s parent company Shin-Etsu Chemical confirmed that operations at several production sites, including SEH’s Shirakawa plant in Nishigo Village, Fukushima, would stay closed as a result of a shutdown of the electric power supply in the area.

It is not known when the plants will be up and running again with the company claiming that a restart of operations can only begin after a safety inspection of equipment and the facilities.  

That said, it seems the likes of Taiwan Semiconductor Manufacturing Company (TSMC) and United Microelectronics Corporation (UMC) could have back-up if necessary.

Elpida, the Japanese DRAM company, is still assessing the quake damage. It said that its Hiroshima plant suffered little impact because it is located in the southwest of Japan and the plant was operating normally without any need to scrap wafers due to seismic effects.

However, the company’s chip assembling and testing plant in Akita-shi, Akita, was not in operation due to power outages.

The company added that it had also stopped operations at its production sites in Annaka , Kamisu and Nishigo Village due to the impact of the earthquake.

Sony faced problems at its two battery cell factories located in Fukushima prefecture. It said that both plants had ceased production in the wake of the quake, and it could be two or three weeks before operations resumed. According to Digitimes this could not only see Sony’s shipments decreasing by 8-10 million battery cells, but also see price hikes here too.

Acer has said the quake has not brought substantial impact on its supply chain with the effect on its procurement of LCD panels, optical disc drives (ODDs) and hard disk drives (HDDs) minimal.

It added that its suppliers such as AUO and Chimei Innolux were Korean and Taiwanese meaning there wouldn’t be a problem.

Panasonic released a statement in which it said its EV Energy plant in Sendai had been destroyed by the tsunami.

It also added that its employees  had been injured in its AVC Networks Company Fukushima Factory, which  manufactured digital cameras. It also said there had been damage to its AVC Networks Company Sendai Factory (manufacturing optical pickups) as well as its Panasonic Electric Works in the Koriyama Factory, which manufactures electronic materials.

It added that although there had been damage to equipment and buildings, major fire and collapse of buildings had not been reported.

“We are suspending operations in the factory affected by the earthquake and continuing to evaluate further details of the damage,” the company added.
Sandisk meanwhile claimed that although both its fabs were down for a short period of time due to the earthquake, they were back up and running.  It said that there were no injuries to SanDisk employees based in Japan and there had been minimal immediate impact on wafer output due to the earthquake.

“SanDisk continues to assess the situation for any potential future impact that may arise from issues related to Japanese infrastructure and the supply chain.”

However it seems all companies may suffer a brief dry spell today with a series of planned electricity blackouts planned to take place through regions in most of eastern Japan.

The blackouts are intended to manage the fall in power generation capacity caused by Friday’s tragedy.