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Intel: Japan Crisis Won't Hurt Chip Production

By - Source: Bloomberg | B 17 comments

Denial? Intel and Qualcomm said the current crisis in Japan won't affect production.

Both Intel and Qualcomm have announced that the current crisis in Japan will not disrupt processor production, as their operations are spread out enough geographically that the ongoing situation won't cause any foreseeable problems.

The news counters previous comments by analysts at Barclays Plc and UBS AG who speculated that shutdowns at Mitsubishi Gas Co would deprive various chipmakers of a much-needed chemical resin (Bismaleimide Triazine, or BT) used in the packaging process, thus causing a disruption in supply.

Currently Japanese producers of some key components and materials used in the electronics sector have no power following the 9.0-magnitude earthquake and the resulting tsunami that crashed onto the island nation on March 11, damaging factories and the transportation infrastructure. Japan is also dealing with damage to some of its nuclear power plants and the growing threat of radiation poisoning. Nearly half a million people are homeless at this point.

Qualcomm, at least, seems to have production under control. "Qualcomm has multiple, geographically diverse sources for supply as well as production processes specifically designed to enable us to mitigate disruptions in our supply chain," the San Diego-based company said in a statement. "We do not foresee any significant impact in our ability to supply product to our customers due to the events in Japan."

The company also added that it will make use of buffer stock and make adjustments to the near-term material mix in case the flow of BT is indeed disrupted. Meanwhile, Qualcomm stocks have fallen $2.50, or 4.7-percent, to $50.50 as of 4pm New York time in Nasdaq Stock Market trading on March 16. Intel stocks also suffered, falling 37 cents, or 1.9-percent, to $19.81.

Chuck Mulloy, a spokesperson for Intel, told Bloomberg that the company plans to keep its commitment to customers. "Our general rule is that nothing is sole-sourced," he said.

Analysts are already indicating that prices across the entire electronics sector may increase due to the disaster in Japan and the resulting ripple of economical disruption reaching out to Taiwan. Both nations supply a large amount of the world's semiconductors, NAND flash memory, DRAM parts and other computer components.

"While there are few reports of actual damage at electronic production facilities, impacts on the transportation and power infrastructure will result in disruptions of supply, resulting in the short supply and rising prices," analysts with IHS iSuppli said in a report March 14. "Components impacted will include NAND flash memory, dynamic random access memory (DRAM), microcontrollers, standard logic, liquid-crystal display (LCD) panels, and LCD parts and materials."

Market research firm Objective Analysis is expecting "phenomenal price swings and large near-term shortages" due to the aftermath of last week's earthquake.

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  • -1 Hide
    abswindows7 , March 17, 2011 7:04 PM
    Japanese don't like FPS but they still managed to rate Quake 8.9/10
  • 3 Hide
    joytech22 , March 17, 2011 7:09 PM
    abswindows7Japanese don't like FPS but they still managed to rate Quake 8.9/10


    Haha! I get that, but at the same time I feel bad about laughing about it..
  • 0 Hide
    Haserath , March 17, 2011 8:06 PM
    abswindows7Japanese don't like FPS but they still managed to rate Quake 8.9/10

    Might want to be careful with the jokes. Someone here might have lost somebody in this catastrophe.
  • Display all 17 comments.
  • -1 Hide
    shak2300 , March 17, 2011 8:15 PM
    HaserathMight want to be careful with the jokes. Someone here might have lost somebody in this catastrophe.


    i agree with you there +1
  • 2 Hide
    dormantreign , March 17, 2011 8:27 PM
    Quote:
    Japanese don't like FPS but they still managed to rate Quake 8.9/10


    I laughed as well. But your also right with the someone could have lost someone, It was a great joke all the same.
  • 0 Hide
    m0j0j0j0 , March 17, 2011 9:05 PM
    how about bringing some intel plants over to the USA!! we could use an economic boost, some job openings... c'mon
    i'd apply if intel was hiring here in michigan !
  • 1 Hide
    eklipz330 , March 17, 2011 9:08 PM
    abswindows7Japanese don't like FPS but they still managed to rate Quake 8.9/10

    i would have laughed but japanese authority have reevaluated the quake to be a 9 =[
  • 0 Hide
    fullofzen , March 17, 2011 9:28 PM
    I'm less concerned about chip shortfalls (the production of which Intel claims seems dispersed) than I am about capacitor shortfalls. The cougar point recall has left motherboards in short supply on its own; I'd look to a hold in the production of the high-quality caps produced in Japan to make P67 boards even more precious than they are now, reducing the potential for price drops over the next few months...

    They're talking about power outages in Tokyo -- complete black outs. This is a huge problem that doesn't sound like it's solved easily. We're talking about one or two plants that are being completely wrecked by the use of corrosive seawater as coolant. You don't replace that kind of capacity over night.

    In other words, what radiation might not do -- power shortages will.
  • 2 Hide
    wild9 , March 17, 2011 10:39 PM
    You know what. My immediate concern is not chip production, but rather what's what's being done to help the Japanese victims who've just had their world turned upside down. As if an earthquake and tsunami wasn't enough, they're now facing the threat of nuclear catastrophe.

    Intel, what humanitarian assistance are you offering?

    http://www.jrc.or.jp/english/index.html
    http://www.redcross.org.uk/Donate-Now/Make-a-single-donation/Japan-Tsunami-Appeal
    http://www.redcross.org/
  • 2 Hide
    xambron , March 18, 2011 12:03 AM
    wild9You know what. My immediate concern is not chip production, but rather what's what's being done to help the Japanese victims who've just had their world turned upside down. As if an earthquake and tsunami wasn't enough, they're now facing the threat of nuclear catastrophe.Intel, what humanitarian assistance are you offering?http://www.jrc.or.jp/english/index.htmlhttp://www.redcross.org.uk/Donate- [...] ami-Appealhttp://www.redcross.org/

    Yeah, I'm in America and I could less about chip production. My i7 920 is suiting me fine, let's help those who can't even use a processor right now.
  • 0 Hide
    Burodsx , March 18, 2011 12:44 AM
    m0j0j0j0how about bringing some intel plants over to the USA!! we could use an economic boost, some job openings... c'moni'd apply if intel was hiring here in michigan !


    Um... They employ people in the US in California, Colorado, Massachusetts, Arizona, New Mexico, Oregon, Texas, Washington, and Utah...
  • -2 Hide
    fullofzen , March 18, 2011 2:08 AM
    xambronYeah, I'm in America and I could less about chip production. My i7 920 is suiting me fine, let's help those who can't even use a processor right now.


    I would bet you a million dollars that the Japanese would love nothing more than for us to worry about when they're going to be in good shape to sell us stuff again...
  • 0 Hide
    jkflipflop98 , March 18, 2011 7:33 AM
    burodsxUm... They employ people in the US in California, Colorado, Massachusetts, Arizona, New Mexico, Oregon, Texas, Washington, and Utah...


    Actually, we employ people in all 50 states. We have at least 1 sales office in each. We also employ people in more than half the countries on Earth.

    "Intel, what humanitarian assistance are you offering?"
    Well, the employees themselves have already contributed almost a million dollars, and the company will match our funds dollar-for-dollar. Not to mention we have nearly 1000 Intel volunteers with boots on the ground over there trying to help wherever they can.

    The better question is, what humanitarian assistance are you offering?
  • 0 Hide
    dalta centauri , March 18, 2011 11:28 AM
    jkflipflop98Actually, we employ people in all 50 states. We have at least 1 sales office in each. We also employ people in more than half the countries on Earth. "Intel, what humanitarian assistance are you offering?"Well, the employees themselves have already contributed almost a million dollars, and the company will match our funds dollar-for-dollar. Not to mention we have nearly 1000 Intel volunteers with boots on the ground over there trying to help wherever they can.The better question is, what humanitarian assistance are you offering?

    How is that a better question over a Companies action to a disaster such as this? It's great to hear Intel doing as you say though, but I'd like to ask;
    As a potential Intel employee, are you offering the same assistance?
  • -1 Hide
    xantek24 , March 18, 2011 6:30 PM
    Intel is the last thing on peoples mind relating to Japan's disaster...So why the BS news? Who gives a Sht about Intel right now?
  • 0 Hide
    hector2 , March 18, 2011 8:55 PM
    mayankleoboy1most of their chips come from taiwan TSMC


    Your ignorance is showing
  • 0 Hide
    hector2 , March 18, 2011 9:05 PM
    m0j0j0j0how about bringing some intel plants over to the USA!! we could use an economic boost, some job openings... c'mon I'd apply if intel was hiring here in michigan !

    Wake up. Most of Intel's high tech chip fabrication is done right here in the US with its biggest plants in Oregon, Arizona & New Mexico. Massachusetts has one has well. Oregon alone has about 18,000 employees. Calif has the headquarters and some development.