The effect of the tsunami on Japan’s tech industry

Tsunami Japan

Japan is still assessing the scale of Friday’s devastating tsunami, but in many parts of the country production has ground to a halt, and any long-term production issues could have a ripple effect on the technology industry.

Many computer and mobile device manufacturers, including Apple and Dell source digital imaging and storage parts manufacturing out to Japan which supplies about 40% of the world’s NAND memory – which is used in products such as Apple’s iPad. Japan is also responsible for a fifth of the world’s semiconductor supplies, and produced about 14 percent of the world’s computers, consumer electronics and communications gear last year.

With Japan being such a prolific NAND flash memory producer, the US based Micron Technology Inc’s shares jumped 3.2 percent with expectation that NAND memory prices would rise after news that Toshiba’s plant in Yokkaichi was affected by the earthquake. Toshiba, by itself, supplies more than a third of the world’s NAND memory chips.

20 of the world’s largest technology companies are Japanese and other large international technology companies such as AMD, Nokia,  Ericsson, IBM, EMC, Xerox, Kodak, Freescale – based in Tsunami stricken Sendai – and Nvidia have operations based in Japan.

Reports are still emerging, but here follows some information on what effect the devastation had on the top Japanese tech companies.

The Hitachi buildings and production facilities in Japan’s Ibaraki- and Fukushima prefectures suffered damage. Hitachi reports that the buildings were evacuated in time but it will probably take a few days before the firm can report the extent of the damage.

All its operations in Japan were halted and there were no immediate estimates as to when they would all be operational again. Sony has six factories, two in Fukushima and four in Miyagi, but all employees were safely evacuated.

Toshiba / SanDisk
Toshiba said yesterday it briefly shut a semiconductor plant in the northern prefecture of Iwate affected by power outage and all are being inspected for damage. According to reports, Toshiba, as a manufacturer of nuclear reactors, was asked by Prime Minister Naoto Kan to support efforts to stop radiation leaking from the Fukushima plant.

The company is said to have halted operations at several plants, including those manufacturing digital cameras, audio products and electronic components, in earthquake-struck northern Japan.
Panasonic’s head office said in a statement: ‘A few employees working at the Fukushima factory, the Sendai factory of AVC Networks Company and at the Koriyama factory of Panasonic Electronic Works received minor injury. As regards the impact on our business operations we are in the process of investigation.’

According to reports from Panasonic North America, three of Panasonic factories situated in Sendai, were still largely intact despite some structural damage.  No damage were reported to Panasonic’s Tokyo and Osaka offices.

According to an official statement there were no reports of injuries sustained by Fujitsu’s employees from the earthquake. There have however, been reports of slight damages to buildings and power outages, but no reports of any severe damage. Fujitsu is investigating whether the disaster had affected their regular business operation at their Iwate plant.

Fujitsu also has manufacturing operations in Fukushima.

Japan’s biggest PC manufacturer, NEC, is still carrying out checks on all its manufacturing facilities to see whether they have been affected by Friday’s devastating earthquake.

The world’s biggest camera maker, didn’t suffer damage to plants that would halt output, said Hirotomo Fujimori, a spokesman in Tokyo, where the company is based.

Fujifilm is still assessing the situation, but the company has a main manufacturing and assembly plant located in Sendai. Co-incidentally, Fujifilm announced 3 days prior to the disaster that there was a delay in shipping the X100 camera.

Sharp’s new LED plant in Sakai also has been shut down, according to reports. Apparently smart systems at the Sakai plant automatically halted production as soon as the first tremors were felt.

Mitsubishi Materials Corp, Japan’s third-largest copper refiner, stopped operations at its Onahama copper smelter in Fukushima prefecture, company spokesman Toshiaki Yamada said.

Sanyo also reportedly implemented shut downs, no specifics were given.

According to Nintendos’ official Twitter account, none of its employees were injured and none of its buildings suffered structural damage. Contrary to the Twitter hoax making rounds, Pokemon creator Satoshi Tajiri did not perish during the destruction.

Though Kyocera’s global headquarters and its wireless division in Yokohama and Daito were not affected, Kyocera stated that they are still assessing the situation.

Olympus suffered no staff injuries or deaths, and reported only minimal structural damage, in some facilities located outside of Tokyo. Olympus does not expect manufacturing of its products to be impacted.

Seiko Epson
Seiko Epson suffered damages to its Sakata plant and also to group companies in the Tohoku areas. They did not report any casualties to staff.

Konica Minolta
Konica Minolta reported no major reports of injuries to employees and its Tokyo office and facilities suffered no major damage. There are also no reports of damage to any of its other production plants in Japan.

Nikon hadn’t issued a statement, but one of its major plants might be affected. It has a camera factory in Sendai, 111 miles west from the epicenter.



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