LONDON – The production of microcontroller ICs – and therefore everything from automobiles to washing machines to consumer gadgets and industrial controls and on to medical equipment – is likely to be "severely" affected by the Japanese earthquake and its aftermath, according to equity research firm Nomura Securities Co. Ltd.
"The earthquake’s impact on microcontrollers is severe," Nomura told clients in a note issued Friday (March 18). What severe means in terms of missing production as a percentage of past levels was not elaborated.
Nomura said that the closure of a wafer fab belonging to Renesas Electronics in the affected area north of Tokyo was likely to hit the production of microcontroller ICs in particular.
Renesas, the world's fifth largest chip company and its largest vendor of microcontrollers has lost approximately half its production capacity. The Renesas campus at Naka is without power and the company has not yet started to assess damage there. The company has a 300-mm wafer fab that made system LSIs and a 200-mm wafer fab that made microcontrollers.
Texas Instruments Miho wafer fab was also severely damaged and Nomura analysts consider that wafers could not be run there before mid-May with the implication that full production could not start until mid-July which means that shipments of packaged chips could not start until September.
Separately, Texas Instruments said its wafer fab in Miho produced only digital light projection chips and some analog ICs and that the status of TI's Miho wafer fab will have no bearing on TI's production of microcontrollers.
Nomura said two other wafer fabs that made microcontrollers and ASICs in Iwate prefecture operated by other companies were closed and this contributed to the severity of the situation. While even those companies affected badly by the earthquake have other wafer fabs, either elsewhere in Japan or overseas, transferring processes and designs may not be possible and some applications, for example automotive, require detailed certification of the production by the customer. This can make manufacturing transfers, where possible, as prolonged a process as bringing up stricken wafer fabs, which is likely to be the chip companies' primary concern, after they have ascertained and done what they can for the safety and well-being of their staff and their families.
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