Taiwan earthquake will disrupt chipmakers that supply Apple, Nvidia: analysts

Taiwan’s largest earthquake since 1999 is more likely to trigger some disruption throughout Asia’s semiconductor provide chain, analysts mentioned, after chipmakers from TSMC to UMC halted some operations to examine services and relocate workers.

The powerful 7.2-magnitude earthquake struck Taiwan’s eastern coast close to Hualien County on Wednesday morning, killing 9 individuals and injuring 800.

The island performs an outsized position within the international chip provide chain as it’s dwelling to the world’s largest chipmaker Taiwan Semiconductor Manufacturing, which provides chips to Apple and Nvidia.

The earthquake struck Taiwan’s japanese coast. Chipmakers from TSMC to UMC halted some operations to examine services and relocate workers. REUTERS

The nation additionally homes smaller chipmakers, together with UMC, Vanguard Worldwide Semiconductor, and Powerchip Semiconductor Manufacturing.

Whereas most of their services usually are not near the earthquake’s epicenter, lots of the companies mentioned that they had evacuated a few of their manufacturing vegetation and shut down some services for inspections.

TSMC mentioned Wednesday that work at its building websites, which has been halted, will resume after inspections, whereas impacted services are anticipated to restart manufacturing all through the night time.

The chipmaker, whose services in Hsinchu, Tainan, and Taichung have skilled various levels of disruptions, could need to delay some shipments and enhance wafer enter to compensate for this, consultancy Isaiah Analysis mentioned in a word.

The island performs an outsized position within the international chip provide chain as it’s dwelling to the world’s largest chipmaker Taiwan Semiconductor Manufacturing, which provides chips to Apple and Nvidia. REUTERS

“Mitigating the impacts of the earthquake necessitates cautious measures and time to revive manufacturing and uphold high quality requirements, presenting further implications and obstacles,” they mentioned.

TSMC’s Tainan operations for superior course of nodes, comparable to 4/5nm and 3nm, had been quickly suspended, they mentioned. As well as, the intense ultraviolet (EUV) lithography tools essential for these superior nodes was halted on the website for a interval of 8-to-15 hours.

Barclays analysts mentioned some extremely subtle semiconductor fabs have to function seamlessly 24/7 in a vacuum state for a number of weeks and the halts would disrupt the method, pushing up pricing strain within the sector.

This might spillover to trigger a “short-term hiccup” to electronics manufacturing in economies centered on upstream merchandise, comparable to Japan and Korea, in addition to economies centered on downstream merchandise, comparable to China and Vietnam, they mentioned

Taiwan Semiconductor Manufacturing, which provides chips to Apple and Nvidia. REUTERS

Nonetheless, the report famous that decrease stock ranges amongst prospects may enable Taiwanese and Korean chipmakers to lift costs.


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