Japanese Earthquake Disrupts Chip Industry Operations

The 7.6 preliminary magnitude earthquake that hit Japan on New Year's Day is forcing Ishikawa Prefecture chip and electronics companies to temporarily shut their doors, with affected companies including Toshiba, GlobalWafers, Murata and others.

According to reports, the earthquake has so far caused the death of at least 62 people, with the death toll rising, as well as collapsing buildings and closing down businesses. The natural disaster prompted tsunami waves that swept cars and houses out to sea, stripped tens of thousands from power and water during winter temperatures, and left the Japan Meterological Agency counting hundreds of tremors and aftershocks.

On Tuesday, Toshiba detailed that its key production hub for power semiconductors, run by subsidiary Kaga Toshiba Electronics, had halted operations while infrastructure was checked for damage.

The company said it would decide on when to resume production as soon as assessments of production lines are completed.

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The 150mm and 200mm wafer factory was slated for expansion beginning in 2024. The growth would bring a 300mm facility in 1H24. Plans for the new wafer fab are luckily set to include earthquake absorbing structures and redundancy power supply lines.

Taiwanese silicon wafter producer GlobalWafers revealed on Wednesday that out of the five plants in Japan under its subsidiaries, two were located in earthquake areas.

"After a brief partial shutdown on [January 1 and 2], production has been fully resumed with no damage," said the company.

The world's largest multilayer ceramic capacitors (MLCC) maker, Murata Manufacturing, was also reportedly assessing facility damage at its two locations near the earthquake epicenter.

Also reportedly affected was chip equipment maker Kokusai Eelctric, which was investigating damage; MLCC manufacturer Taiyo Yuden; and silicon wafer producer Shin-Etsu.

According to Trendforce, the timing of the earthquake may be a silver lining for chip and related supply chain disruption. The market intel firm said the impact of the earthquake on the industry is "manageable," accrediting this to a current downturn in the semiconductor industry, paired with the off-season period, low component inventories, and the fact that most factories are located in areas with seismic intensities of level 4 to 5 therefore did not suffer much infrastructure damage.

Luckily, the Nuclear Regulations Authority has reported no abnormalities at nuclear plants along the affected area of the Sea of Japan.

A 2011 earthquake and subsequent tsunami was the impetus for the nuclear meltdowns that occurred at Fukushima. The wastewater from the nuclear fission disaster was only recently released, this past summer, a situation which has drawn concern from some. ®