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Taiwan Hit by 6.4 Earthquake – Hsinchu and Tainan sites affected

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The southern part of Taiwan, roughly 250 miles south of Taipei, was struck with a magnitude 6.4 earthquake at 8:18am, local time.  The epicenter was located in Jiahsian in Kaohsiung county; an area still recovering from the recent typhoon.  While Taiwan typically endures earthquakes on a regular 5-year basis, these are significant events to both human and business activities.  Thankfully no deaths have been reported at this time and no Tsunami watches or warnings have been issued.

With the epicenter located 250 miles south of Taipei, Tainan recorded a magnitude 5 while Hsinchu recorded magnitude 2 levels.  Both levels are significant and have impacted operations at these two important areas for semiconductor and LCD production due to power loss, temporary stoppages, equipment damage, and product damage or loss.  The mid- to long-term supply chain effects are forecasted to reduce or eliminate any downward pressure on ASPs, especially for panels, which were facing lowered pricing pressures.

The following are still initial reports and are likely to be modified as more time allows for more data and information to be collected:

Wafers:

  • TSMC is still assessing final impact, but a minimum of 40,000 eight-inch wafers, roughly 1.5 days worth of production, was lost.  TSMC's earthquake contingency plans are in place and moving the company's facilities and processes through the disruption. (see here for source information).  The impact on 2Q10 revenue has yet to be assessed but initial estimates are at ~1%, as reported by The Wall Street Journal.
  • Advanced Semiconductor Engineering, Inc. reported minor disruptions, is still inspecting packaging equipment, reviewing financial losses, but told TheWall Street Journal that production has resumed.  Bloomberg reported that the Kaohsiung plants were operating normally.
  • UMC reported minor damage to some production equipment but did not report any significant impact to their operations, as reported toBloomberg.

Displays:

NOTE: the average time that the following companies have taken to resume normal production after a temporary shut-down is 2-5 days after an earthquake, according to DisplaySearch Blog.

  • Hannstar Display Corporation, had evacuated employees and shut down the factory temporarily but did not otherwise report any losses or effects on their production according to both Bloomberg and The Wall Street Journal, and confirmed by Smith & Associates locally. DisplaySearch reports HannStar's took 3-5 days to resume production after the last earthquake.
  • AU Optronics Corporation also evacuated employees and temporarily shut down production at their Tainan facilities.  They have reported to newswires that their finances and operations suffered "no significant impact."
  • Chi Mei Optoelectronics also reported temporary shut downs and evacuations but added that resumption of full production activities is likely to take one to two days, as reported by Barron's. DisplaySearchreports an average of 2-3 days for CMO to resume production post earthquake.

More detailed information about glass substrate production is provided in detail by DisplaySearch here.


Lisa Ann Cairns, Ph.D.
Written on Friday, 05 March 2010 09:10 by Lisa Ann Cairns, Ph.D.

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