Japan supply chain disruption may last all year
Japanese supply chain disruptions may not recover until the end of the year, says Takeshi Hattori, president of Hattori Consulting International and columnist for Japan’s Electronic Journal.
“Supply chains will not fully recover until this fall at earliest or until the end of this year, according to the Ministry of Economics, Trade, and Industry (METI),” writes Hattori in a new report on the effects of the earthquake, “two fabs at the centre of attention—Renesas Electronics’ Naka Factory, a manufacturing base of microcontroller-embedded SoCs for the automobile industries not only in Japan but also worldwide, and SEH’s Shirakawa Plant, the world largest silicon crystal manufacturing site, – have just revealed their recovery roadmap toward this summer.”
“Since announcing on March 28 its target to restart part of its manufacturing at the Naka Factory by July, the company has been working hard with more than 2,000 additional support workers dispatched from outside companies (mainly from the major automobile companies) to help speed up the resumption of production as much as possible,” says Hattori.
“As a result of these efforts, the firm estimates it will move up the schedule for production (wafer input) at the 200mm wafer fabrication line to June 15, though not at full production levels,” he writes.
“A second updated schedule of the Naka Factory is expected in mid-May, once the company confirms when the production capacity at both the 200mm and 300mm wafer fabrication lines can return to pre-earthquake levels with the capacity added by shifting production to other factories,” says Hattori.
“SEH, the world’s largest silicon wafer supplier, announced on April 28th that its Shirakawa Plant in Fukushima Prefecture started very partial production on April 20,” says Hattori, “accelerating necessary restoration work, they will gradually increase operations toward this summer, and expect to return to prior production capacity levels by the end of June or sometime in July. There is, however, a possibility of change of the time frame, according to the company, depending on such circumstances as big aftershocks, unstable electricity supply, and unexpected blackouts, even though Shin-etsu Group has their own two power stations in Japan. The company is coping with the current situation by increasing production operations at each of SEH Group’s silicon wafer production fabs worldwide.”
Toshiba has decided to operate their major semiconductor fabs through the “Golden Week, including its Yokkaichi Plant in Mie Prefecture, to meet growing demand for flash memory chips.
Fujitsu also will operate all its semiconductor fabs in Japan during the Golden Week for efficiently using electricity, while other plants and offices are on a break nationwide.
“Toyota Motor Corp. says its production operations are expected to normalise around November or December timeframe. In Japan, partial normalisation of production is expected to start in July, with normalisation completing around November or December,” says Hattori, “outside Japan, depending on region and vehicle model, normalisation of production is expected to start in August, with normalisation completing around November or December.”
Hattori continues: “The nuclear crisis is ongoing with unstable GE/Toshiba/Hitachi-made reactors in Fukushima Daiichi nuclear plant, and an electricity shortage in East Japan including the greater Tokyo area continues toward the summer peak, some 60% of major manufacturers in major industries in the areas affected by the March 11 disaster have already resumed partial production, while nearly 30% are expected to resume production in a few months, according to a hearing survey conducted by METI.”
“The Japanese government will officially set by early May a target for electricity consumption this summer: a 15% reduction from the peak-demand timeframe of last summer for all users (industrial, commercial and household) in the service area of Tokyo Electric Power Co. (TEPCO), announced METI minister S. Kaieda in Tokyo on Thursday, April 28. When the quake hit, TEPCO shut down 11 reactors including three that were in operation at the Fukushima Daiichi plant. With the 11 reactors of offline, electric capacity of 9.7GW is gone.”
“TEPCO cannot import enough electric power from West Japan, because Japan lacks a national power grid. Japan’s electricity system got its start in 1883 with the founding of private Tokyo Electric Light Co., purchasing 50Hz generators from Germany’s AEG in 1895. In West Japan, Osaka Electric Lamp Co. independently imported 60Hz equipment from General Electric in the United States in 1887. Since then, Japan has maintained the two different commercial electric frequencies. There are presently three frequency changing stations in the middle of Japan near Mt. Fuji but with a capacity of only 1GW.”
The “PV Japan” Exhibition 2011, sponsored by SEMI and Japan Photovoltaic Energy Association, has been postponed to December 5-7 from the end of July previously scheduled, because the electricity consumption will be anticipated to hit the peak in the July-August time frame in Japan.
Looking at the travel situation for the earthquakwe-stricken North-Eastern part of Japan, Hattori writes, “East Japan Railway Co. (JR East) resumed Tohoku Shinkansen bullet train services between Tokyo and Sendai on Monday, April 25, connecting Tokyo and Sendai directly for the first time since the 9.0-magnitude earthquake and tsunami hitting the Tohoku District on March 11.
“Finally, Tohoku Shinkansen’s entire services between Tokyo and Shin Aomori, northern-tip of Honshu (main island) via Sendai will be resuming on April 29th. Damage of 1750 locations on rails, electric poles, river bridges, and train stations were mostly repaired in the Tohoku Shinkansen line, but there are still several blockages in JR East local lines serving along the Pacific Coast in Tohoku District. Akita and Yamagata Shinkansens have already been operational according to a special timetable with reduced number of train services.”
“With Tohoku Shinkansen now available, relief flight services between Tokyo (Haneda) and Sendai will be discontinued after April 29. Relief flights between Sendai and Osaka/Nagoya/ Sapporo are available part ially using tsunami-hit Sendai Airport terminal building and a cleaned-up runway,” reports Hattori.