Quake may affect tech industry for six months, says analyst

Memory chips, chip packaging and other products will see disruptions in Japan, research head says

World technology hardware supplies will take as long as six months to resume normal flows following disruptions from last week's massive earthquake in Japan, a lead Bank of America Merrill Lynch researcher said on Wednesday.

The magnitude 9.0 quake and deadly tsunami on Friday will prompt manufacturers to reexamine supplies in Japan, then look for outside suppliers if needed and finally sort out component mismatches resulting from deals with new vendors, said Daniel Heyler, the investment bank's head of global semiconductor research.

The quake damaged some Japanese tech suppliers, while knock-on power shortages and transportation snags have hurt others.

Recovery could easily be a two-quarter process even if there's some electricity and factories get running again, Heyler said at a technology conference in Taipei. Inventories should hold for four to six weeks, he said.

BT substrates, used in chip packaging, will be hit particularly hard, the New York-based firm believes, as Japan makes some 90 percent of the world's supply and the top two vendors have quit taking orders.

Spare parts in numerous tech hardware manufacturing categories will also slow down, he said.

Memory chips prices are already soaring, but Heyler said he did not expect a DRAM supply crisis as there's enough in the supply chain now. He anticipated a more pronounced influence on NAND flash chips for cameras and smartphones. Memory shortages could prompt makers of PCs or electronics to use fewer chips, which would compromise performance but keep shipments on schedule.

Other impacts on end users are too early to tell, Merrill Lynch believes.

"It's going to be choppy," he told reporters after a conference speech. "It's all about Japan's recovery and about finding stuff elsewhere. It's a more complicated process than people think."

On the brighter side, many of the major hardware material suppliers are in southern Japan, which was relatively unaffected by the earthquake north of Tokyo.

Raw material for semiconductors and touchscreen panels will also slow after the quake, other analysts have said. Consumer electronics manufacturers in Taiwan, a major tech manufacturing hub, are nervously checking with suppliers in Japan about shortages.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags consumer electronicsDaniel HeylerComponentsMerrill Lynch

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Ralph Jennings

IDG News Service
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Michael Hargreaves

Windows 10 for Business / Dell XPS

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?