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The strongest earthquake to hit Taiwan in at least 25 years is likely to cause temporary disruption. semiconductor supply chain and related technology products will be sold as manufacturers resume normal operations after the earthquake.
A magnitude 7.2 earthquake with aftershocks struck Taiwan’s east coast on Wednesday morning, killing 10 people and injuring more than 1,000. The country plays a key role in the global semiconductor supply chain and is home to Apple and Taiwan Semiconductor Manufacturing Co. (TSMC), the world’s largest chipmaker and supplier of chips to Apple. Artificial intelligence (AI) Huge Nvidia.
A Taiwanese chipmaker has installed a system that protects the most sensitive technology used in its manufacturing process from damage during an earthquake by automatically shutting down the system when an earthquake begins.
Despite these systems, Barclays analysts said some of the most advanced semiconductor programs require continuous operation in a vacuum for weeks, and a pause would disrupt the process, Reuters reported. , which could impact inventory levels and prices.
Taiwan Earthquake: Death toll reaches 10, rescue operations continue
Taiwan Semiconductor Manufacturing Co. told FOX Business that it is restoring operations at its chip factory following the earthquake. (Photographer: Mike Kai Chen/Bloomberg via Getty Images/Getty Images)
TSMC told FOX Business that it is deploying all available assets toward a full restoration of its production systems and is coordinating with customers as necessary. We also provided the latest information on how it works. chip manufacturing The facility, known as the fab, was affected by the earthquake and how its recovery was progressing as of Thursday.
“The safety systems of TSMC’s Taiwan factory were operating normally. At that time, precautionary measures were initiated to ensure the safety and health of employees in accordance with protocols, and some factories were evacuated. All employees were safe. “He returned to work immediately after the incident occurred,” the company said. said in a statement. It also pointed out that the largest earthquake at three of the facilities was a magnitude 5, while the other two experienced a magnitude 4 earthquake.
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Rescue workers leave the scene as the last person found trapped in a heavily tilted building was found after a magnitude 7.3 earthquake in Hualien County, Taiwan, on April 3, 2024. (Photo credit: Yang Chengchen/China News Service/VCG via Getty Images / Getty Images)
TSMC cites its “rich experience and capabilities.” Earthquake response The company said, “Within 10 hours of the earthquake, our factory’s overall tool recovery rate was over 70%, and our 18 fabs were over 80%.”
“As of April 4, the overall tool recovery rate has reached over 80%, and new fabs, including Fab 18 facility, are expected to reach full recovery later tonight,” TSMC added. “A small number of tools were damaged at certain facilities, partially impacting operations.”
“However, there is no damage to our critical tools, including all of our extreme ultraviolet (EUV) lithography tools. Certain production lines in areas affected by the larger earthquake have been moved to fully automated production. It is expected that additional time will be required for adjustment and calibration before returning,” TSMC explained.
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| ticker | safety | last | change | change % |
|---|---|---|---|---|
| TSM | Taiwan Semiconductor Manufacturing Co., Ltd. | 139.64 | -2.31 | -1.63% |
| NVDA | NVIDIA Corporation | 859.00 | -30.64 | -3.44% |
Nvidia, which designs advanced AI chips to power generative AI tools and the large-scale language models used to train them, has a contract with TSMC for the production of some of its chips.
“After discussions with our manufacturing partners, we do not anticipate any impact to our supply,” an Nvidia spokesperson told FOX Business. Taiwan earthquake. ”
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Heavy equipment is used to demolish the Uranus building that was damaged in the April 3 earthquake in Hualien City, Taiwan, April 5, 2024. (Photo by I-HWA CHENG/AFP via Getty Images/Getty Images)
The earthquake also highlighted the important role Taiwan plays in the chip supply chain and the importance of redundancy in such critical technology. world economy.
Nazak Nikakhtar, a partner at Wiley Lane LLP who previously worked in national security at the Department of Commerce, told FOX Business, “While we expect a short-term impact on Taiwan’s semiconductor business, there will be no disruption.” “It could clear up quickly and it will probably recover.”
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“On a broader level, this should serve as a stark reminder to the rest of the world that we need redundancy in our supply chains. “To ask for one region is a recipe for disaster,” she added.
Reuters contributed to this report.
