The supply of flash memory chips, a principal component in hot-selling tablets and smartphones, will likely be affected by the earthquake in Japan, according to a report. But the factories that manufacture flash are well to the south of the quake's epicenter, possibly mitigating the impact.
An 8.9-magnitude earthquake and series of major tsunamis struck Japan on Friday, causing massive damage. The quake struck Friday at 2:46 p.m. local time about 230 miles northeast of Tokyo. Aftershocks registered 7.1, 6.2, and 5.9, according to the U.S. Geological Survey's report. At least 184 deaths have been confirmed and officials say the death toll is likely to rise to more than 1,000.
Over 40 percent of the world's NAND flash and roughly 15 percent of the world's DRAM are manufactured in Japan, according to a report released today by Objective Analysis, a firm that does semiconductor-related market research.
SanDisk, which sources flash memory from a Toshiba manufacturing facility in Yokkaichi (see map), reported a shutdown but resumed production, according to Jim Handy, the principal analyst at Objective Analysis. (This was confirmed by SanDisk, which has co-ownership of the facility.) That Yokkaichi complex is the largest NAND flash producer in the world, Handy said.
By comparison, in December, Toshiba reported a relatively tiny split-second outage in Yokkaichi that the company said would impact production by as much as 20 percent for up to two months. If the shutdown was longer this time--which Handy believes it was--the effect could be more dire.
"This earthquake was a lot more than milliseconds," Handy said.
SanDisk released this comment late Friday about its "fabs," or chip fabrication facilities. "The epicenter of the powerful earthquake was approximately 500 miles from Yokkaichi, Mie Prefecture, Japan, the location of the two Toshiba-SanDisk joint-venture semiconductor manufacturing plants, Fab 3 and Fab 4. Both fabs were down for a short period of time due to the earthquake and were back up and operational as of Friday morning, Pacific Time."
The SanDisk comment continued. "There were no injuries to SanDisk employees based in Japan. SanDisk's current assessment is that there has been minimal immediate impact on wafer output due to the earthquake. SanDisk continues to assess the situation for any potential future impact that may arise from issues related to Japanese infrastructure and the supply chain."
Toshiba is still trying to sift through data on the damage. "As with any significant disaster, much information is coming in piecemeal and unconfirmed," Toshiba said in a statement today. Toshiba America Electronic Components "is working with other affiliates and Toshiba Corporation to sift through the information."
The statement continued. "In addition to delivery interruptions that may arise from factory damage, shipments of product may be affected by disruptions in road, rail, sea, and air transportation within and from Japan."
Apple is large consumer of flash memory and has signed half-billion-dollar deals with Toshiba in the past for supply of flash memory. "Apple does this advanced payment thing. They do them in chunks of $500 million at a time," said Handy. But Apple has alternative sources for flash memory such as Samsung and Micron Technology.
Much nearer to the earthquake's epicenter, Fujitsu and Toshiba have wafer fabs in Iwate prefecture, according to a report in EE Times. Fujitsu's Iwate plant manufactures flash microcontrollers and system chips for games machines, digital appliances, and automotive products, according to EE Times.
"Currently, there are indications that the Iwate factory has been affected by a power outage. All factories are being inspected for damage," Toshiba said.
Apple has not yet responded to queries.
Updated on Saturday, March 12 at 1:00 a.m. PST: adding comments from SanDisk and adding discussion about flash chip production being far south of the earthquake's epicenter, possibly mitigating the impact on production disruption.