Japanese Earthquakes Affect Production

After a series of ground-shaking quakes this week in south-west Japan, the electronics industry and major supply chains have been disrupted. Last thursday evening (Japan time), the Kumamoto prefecture experienced a powerful earthquake reaching a 6.4 on the Richter scale. Merely two days later, a 7.3 triggered tsunami warnings and a series of powerful aftershocks in tow.

In addition to a number of deaths and thousands injured, many electronics manufacturing plants have been affected by these recent events.

Mitsubishi Electric was hit hard, with three manufacturing plants in the area being forced to suspend production, most notably an LCD parts facility. The other manufacturing plants involved a semiconductor production plant and power devices.

Both Sony and Renesas Electronics are also experiencing the negative aftermath of this past week’s events. While Renesas Electronics is known for its computer chips mainly for use in the automotive industry, Sony’s Kumamoto plant develops digital image sensors used in cameras and smartphone products worldwide. Their production will have to be shifted to other facilities rather quickly in order to defer any effect on the impressively large smartphone market and to avoid shortages of these specialized sensors.

Although Japan was shaken by this week’s earthquake, the 2011 earthquake and following tsunami prepared them for the worst, and although difficult to overcome they were more readily prepared for another event of such magnitude. We will see the effects on the consumer market in the weeks to come.