Flat panel makers face shortages after Japanese quake

AU Optronics reports closure of a subsidiary; other firms may struggle to get chemicals

Major display panel manufacturers face a shortage of materials from Japan as the powerful earthquake on Friday has hit their suppliers, companies and analysts said on Tuesday, pointing toward price rises in PCs or mobile phones and a possible slowdown in production.

The magnitude 9.0 quake that has disrupted transport and electricity production in Japan jolted Hitachi Chemical and Sony Chemical, which supply 80 to 90 percent of the products that bond integrated circuits to glass panels for consumer electronics displays, said Sebastian Ho , an analyst with Yuanta Investment Consulting in Taipei.

Major panel makers AU Optronics, Chi Mei Innolux, LG Electronics and Samsung Electronics can probably hold out on existing supplies for 40 days, after which they would face shortages if the two Japanese suppliers did not resume normal operations. Those four firms make about 85 percent of the world's panel production.

If faced with shortages, panel makers would probably raise prices, forcing panel buyers to pass those costs on to end consumers, Ho said, adding that Apple in particular might delay shipments.

Taiwan's Wintek Corp., an Apple touch screen contractor, said it had seen no impact from the quake yet but was on guard for later dips in supplies.

Taiwan's Wintek Corp., an Apple touch screen contractor, said it had seen no effect from the quake yet but was on guard for later dips in supplies. The biggest threat may come from power shortages, said Wintek financial director Jay Huang.

Supplies of components for LCD panels may also be disrupted, market research firm IHS iSuppli said. Production of color polarizers at Fuji Film, for example, was affected and may changes prices of this key component.

Also in Taiwan, Chimei Innolux said it had seen minimal quake impact but was watching its supply chain.

The earthquake has also threatened supplies of raw wafers for semiconductors and jolted business for Japan's major tech firms.

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Tags displaysAU OptronicsComponentsSamsung ElectronicsLG ElectronicsChi Mei InnoluxWintek

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Ralph Jennings

IDG News Service
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