Japan Earthquake Disrupts Chip and Automotive Plants
A magnitude 7.1 earthquake that struck Kumamoto Prefecture, Japan, has triggered major disruption to the national industrial sector. A number of semiconductor and automotive manufacturing plants have been forced to halt operations, sparking fears of wider economic damage should the shutdowns persist over the long term.
The semiconductor sector is among the worst affected. Sony Semiconductor Manufacturing Corp., a subsidiary of Sony Group Corp., immediately stopped operations at its plant in Kikuyo shortly after the quake struck on Tuesday. Management has yet to set a definite date for when production will resume.
Similar steps have been taken by two other chip giants, Renesas Electronics Corp. and Tokyo Electron Ltd., which suspended operations at two of their respective plants in the Kumamoto area. In addition, Mitsubishi Electric Corp. has also halted production lines at its facilities in Koshi City and Kikuchi.
The automotive industry has also felt a significant impact from the supply chain disruption. Toyota Motor Kyushu Inc. had initially resumed operations at three of its plants in Fukuoka Prefecture following preliminary safety inspections. However, the company ultimately decided to halt operations again from Wednesday evening until Friday evening.
Toyota stated that the decision was taken due to logistics disruption and the condition of suppliers affected by the earthquake. Beyond Toyota, several other automotive manufacturers have also reported production stoppages.
The production halts are not limited to the technology and automotive sectors. In the consumer goods and chemicals sector, Suntory Holdings Ltd. suspended activities at its beer plant in Kashima, whilst Mitsubishi Chemical Corp. temporarily closed its facility in Uto.
Nippon Paper Industries Co. has suffered a rather serious situation. The company reported that the smokestack at its Yatsushiro plant was severely damaged. Technical teams are still assessing the extent of the damage and have not been able to confirm when paper production at the facility can return to normal.
The paralysis of industrial activity has been exacerbated by disrupted logistics services across Kumamoto. Japan Post has suspended services at post offices throughout the prefecture. Private courier companies such as Yamato Transport and Sagawa Express have also temporarily halted parcel collection and delivery in a number of affected areas to ensure the safety of personnel and fleets.