TSMC factories affected after 6.4 magnitude earthquake in Taiwan

A magnitude 6.4 earthquake struck southern Taiwan today at 12:17 pm Beijing time, causing damage to several buildings near the epicenter. Part of TSMC’s production was halted and employees were evacuated from their workplaces.

The epicenter was about 37.9 kilometers southeast of Chiayi, approximately 50 kilometers east of Tainan, where TSMC has at least four facilities, and about 115 kilometers south of Taichung, where it has two factories.

The mountainous area is sparsely populated, which limited damage to buildings and resulted in a small number of injuries. Even so, Tainan experienced a magnitude 5 earthquake, which prompted TSMC to halt production and evacuate its workers in central and southern Taiwan.

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TSMC statement

In an email to Reuters, TSMC stated: “Post-earthquake structural inspections have been completed at all sites, confirming that structures are safe and operations are gradually resuming”.

Water supply, power and security systems are functioning normally, and all TSMC sites are operating normally, although detailed inspections and impact assessments are ongoing.

As a result, no impact on global chip production is expectedwhich calms companies that depend on the production of the largest manufacturer of advanced chips in the world, which supplies companies like Apple and Nvidia.

Vulnerability

The incident also highlights the company’s vulnerability to disasters. If a major catastrophe hits Taiwan and halts production for several weeks, it could have a domino effect on the global supply chain for electronic devices, affecting everything from smartphones and laptops to cars and solar cells.

Furthermore, There is geopolitical pressure on the island nation, as China, its much larger neighbor, has expressed a desire to control the island, by force if necessary.

To get around it, TSMC has already made progress in creating advanced factories elsewhere, with the Arizona factory’s production already being tested by its customers like Apple, AMD and Nvidia for quality. The company also plans to build factories in Europe.

However, This expansion will contribute only about 10% of total productionmeaning there will still be a production bottleneck for the most advanced silicon should a significant disaster occur in Taiwan.

Not only does TSMC’s chip packaging in Arizona still take place in Taiwan, and it will take a few years for facilities capable of performing this function to come into operation in the U.S..

Source: Reuters.