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Intel says its operation in Japan not affected by the earthquake crisis

March 18th, 2011        

Intel says its operation in Japan not affected by the earthquake crisis

Intel has officially announced that the current crisis in Japan will not disrupt processor production in Intel factories located in Japan, as their operations are spread out enough geographically that the ongoing situation will not cause any lump to their operations.

This goes against statement from analysts at Barclays Plc and UBS AG, as the shutdowns at Mitsubishi Gas Co would deprive chipmakers of a key chemical resin (Bismaleimide Triazine, or BT) used in the packaging process.

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.

Due to the earthquake and tsunami crisis that struck Japan last week, many factories are damaged, besides infrastructure which also suffers heavy damage, causing trouble to transportation of goods. Also, power grid in Japan has been affected due to the nuclear reactor crisis in Fukushima I that caused a radiation crisis poisoning, and forcing many people to live in the dark.

Qualcomm has also mentioned that its operation in Japan has not been affected, and the company will make use of buffer stock and make adjustments to the near-term material mix in case the flow of BT is indeed disrupted.

“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.”

Analysts are already indicating that prices across the entire electronics sector may increase due to the disaster in Japan and the resulting ripple of economic 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.”

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