Thursday, March 17, 2011

Tech Industry Crippled in Quake Aftermath

The list of tech-related businesses hobbled by the recent earthquake and tsunami in Japan continues to multiply, with battery makers, semiconductor companies and LCD display makers facing shortages and slowdowns that may affect mobile device makers in coming months.


Top News

RIM's PlayBook to Fight Apple, Google
Sprint Gives Rebates to Lure Customers

Verizon's 4G Network Doubles AT&T Speeds

Apple Accused of Crippling Web Apps

Letterman Does Top Ten Reasons to Buy IPad 2

More News >

The global supply of rechargeable batteries may take a hit with plant closures by Sony, while halt of shipments may hurt supplies of circuit chips used in mobile devices. Prices of components like LCD panels and memory chips could rise due to shortages sparked by the earthquake, which has damaged factories and wrecked the transportation and power infrastructure critical to manufacturing.
Overall shortages and delays of these critical components may affect prices and delay launches of products reliant on Japanese parts, beginning with the rechargeable batteries included in so many mobile devices.
"It's too early to tell when we can restart output," said Hiroshi Okubo, spokesperson for Sony, speaking on the company's eight closed battery plants in Fukushima prefecture. Sony is grappling with uncertainty over obtaining materials to make batteries, as well as transportation difficulties and power shortages, according to Okubo.
Panasonic, which controls Sanyo Electric, Japan's biggest maker of rechargeable batteries, has halted operations at some of its plants located north of Tokyo as well. Sanyo hasn't seen an impact on lithium-ion battery production so far, according to Sanyo spokesperson Akihiko Oiwa, who added that Sanyo's rechargeable-battery operations are based in western Japan.
LCD screen shortages could impact in particular LG's mobile phones as well as TV makers.
Hitachi's LCD display factory has suspended operations, and slow shipments may affect LG's mobile phones and Nintendo's handheld DS business if the factory is halted for longer than a month, according to analysts at ISuppli. Hitachi has not yet determined when its LCD display company can resume operation, but the company is considering leveraging its relationship with Taiwan-based Chimei Innolux to minimize the risk of a production decline.
Panasonic's factory producing LCD TV panels has been shut down and that may influence the availability and prices of products, it said.
"There has been some damage, though not a fire or a collapse," at Panasonic's LCD factory in Mobara, Chiba prefecture, said Akira Katoda, a company spokesman. Panasonic hasn't determined when to restart the factory, he said, and may consider shifting LCD operations to a plant in Himeji, western Japan, in order to avoid severe shortages.
The chip industry is also likely to be affected if companies like Hitachi Chemical and Mitsubishi Gas Chemical suspend their factories for more than two weeks, according to analysts. Nippon Chemi-Con's halting of aluminum-capacitor production may disrupt semiconductor chip supplies as well.
The domino effect of the quake on the tech industry highlights the sector's reliance upon Japan, which produces about 40 percent of the world's electronics and audiovisual components and 60 percent of the silicon used to make semiconductors.
The quake in Japan was one of the strongest recorded in the world's history, and the largest-ever for Japan, leading to massive loss of life. The quake also led to a series of explosions in the country's Fukushima Daiichi nuclear power plant that have resulted in the world's worst nuclear crisis since the Chernobyl accident in 1986.

No comments:

Post a Comment