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Car makers, dealers and buyers facing supply shortages until autumn
publication date: May 23, 2011
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author/source: Robin Roberts
| Car makers around the world are facing the
prospect of a dramatic drop in supplies of an essential semi-conductor
used in emission control equipment, says the Daily Yomiuri paper in Japan. | The paper reports that semiconductor company Renesas
Electronics Corp. said product shipments from its Naka factory in June
will drop by about 90 percent from levels recorded before the March 11
earthquake, an apparent blow to automakers and electronic manufacturers
dependent on the company's products.
Renesas President Yasushi Akao said the company's products on
hand will run out by the end of May.
The decline is caused by the
shutdown of the Naka factory, its main production base in Hitachinaka,
Ibaraki Prefecture, which was hit by the earthquake. The company said it
planned to return its supply of products to pre-earthquake levels by
the end of October.
Renesas has a global market share of about 40
percent in automotive semiconductors (microcontrollers), more than any
other company. The company also holds a large market share in
large-scale integration (LSI) circuits for cell phones.
According
to Renesas, all of the company's major products were manufactured at
the Naka factory.
| | Overhaul of industry predicted after quake hits lines
Manufacturers
and their suppliers will start to move to more localised supply chains
to offset issues such as the one caused by the Japanese earthquake.
Richard
Gane, PricewaterhouseCoopers lead project director, said the Tier 2 and
3 suppliers were often single sourced, but this would change.
He
pointed to the Hitachi plant in Japan which supplies chips that go into
modules. Most manufacturers have been affected by supply shortages.
"They
have to have alternatives, which means more localisation and less long
range manufacturer and supply," Gane told the ACFO conference at Gaydon. | After the factory was forced to halt its operations by
the March earthquake, many automakers in Japan and abroad were unable
to produce some of their products due to a shortage of necessary parts
from Renesas.
After the earthquake, automakers and electronic
manufacturers provided about 2,500 workers to help the company restore
the Naka factory. The factory building was restored on April 10, and
Renesas was able to begin test production on April 23 for automotive
semiconductors and on April 25 for LSI circuits.
However, Akao said, "We can't avoid a drop in shipments from June."
Akao
said along with restoring the Naka factory, the company will utilize
other production facilities in Japan and abroad to return supplies of
its products to the level before the earthquake by the end of October.
However,
after Renesas' stock of automotive semiconductors and LSI circuits run
out, the factory's June product shipments are expected to fall to about
10 percent of what they were before the disaster.
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