Today, on April 3rd, a magnitude 7.3 earthquake struck off the coast of Hualien County in Taiwan, marking the most significant seismic event since the "921" earthquake 25 years ago.
Both TSMC and UMC have informed reporters from Caijing News Agency that partial shutdowns have occurred due to the earthquake's impact. Several wafer fabs have publicly announced halting operations for inspection.
Under these circumstances, there is widespread concern about whether the semiconductor industry will experience a recurrence of the "chip shortage" seen in 2021.
"The earthquake in Taiwan mainly affects wafer foundry and packaging testing processes. Currently, 14nm and above wafer manufacturing, as well as advanced packaging represented by CoWoS, are primarily conducted in Taiwan," said Zhou Hua, Chief Analyst at CINNO Research, in an interview with reporters.
Taiwan is currently the world's largest semiconductor production base. "If Taiwan is unable to produce chips for an entire year, global electronics revenue will decrease by nearly $500 billion," described the Semiconductor Industry Association (SIA) of the United States, highlighting Taiwan's critical role in the global semiconductor supply chain. According to statistics from TrendForce, Taiwan accounts for approximately 46% of global wafer foundry capacity in 2023.
"Taiwan experienced several noticeable earthquakes this morning. Our safety systems are functioning normally. To ensure the safety of personnel, we have initiated relevant precautionary measures according to internal company procedures. Some factory areas have been evacuated, and currently, all personnel are safe and gradually returning to their workstations. Detailed conditions are yet to be confirmed. Additionally, due to safety considerations, we have decided to halt construction at various sites across Taiwan today and will resume construction after inspections," replied TSMC, the leading wafer foundry, to Caijing News Agency.
Another major wafer foundry, UMC, also informed reporters, "Currently, personnel at our Hsinchu and Tainan facilities have been evacuated according to operational standards. Personnel are safe, facilities are normal, some equipment has been shut down, and engineering colleagues are actively taking inventory and resuming operations."
Furthermore, based on multiple media reports, TSMC has preemptively shut down some equipment, with the exact impact still being assessed; HDI process manufacturer Unimicron's Yilan PCB production line is undergoing shutdown inspections; NAND flash manufacturer Nanya Technology has preemptively shut down some equipment for safety checks; Micron is evaluating business operations and supply chains; panel manufacturers Innolux and AUO have evacuated personnel from some factory areas.
It is evident that production at various stages of the semiconductor supply chain has been affected, with wafer production being the most severely impacted due to its high proportion. In this situation, will there be significant disruptions in the semiconductor industry? Zhou Hua, Chief Analyst at CINNO Research, believes that based on Taiwan's experience with earthquakes, companies like TSMC have mature emergency response mechanisms, limiting the impact on their capacity and supply chains.
However, in the storage market, AI industry development has driven the demand for storage chips. Recent media reports indicate that due to strong demand, Samsung Electronics will raise prices for commercial SSDs by up to 25% in the second quarter.
Nanya Technology, the world's fourth-largest DRAM chip manufacturer located in Taiwan, has also been affected by this earthquake, further exacerbating the supply shortage in the storage market.
Zhou Hua further stated that analog chips, especially industrial ones, are still in the inventory adjustment phase, with relatively weak market demand. Therefore, the impact of this earthquake on the analog chip market may be smaller.
