It seems inevitable that South Korea’s chip and display manufacturers would have to postpone their plans to expand assembly lines due to fallouts from the Japan earthquake.
The domestic manufacturers are worried about delays in arrivals of major equipment imported from Japan and difficulties in procurement of parts commonly used for domestic equipment, deciding to postpone their schedules to expand production facilities.
According to the industry on Thursday, Samsung Electronics and Samsung Mobile Display (SMD) are said to put off their plans to install equipment and expand facilities.
It will be hard for Korean companies to be supplied as planned with core equipment produced by Tokyo Electron, the world’s second-largest chip equipment maker, because the company is suffering power shortages and delays in normalization of logistics.
Samsung Electronics is in a hurry to bring equipment to its new chip plant in Giheung. However, the company is likely to have problems in importing equipment since major ones like CVD (chemical vapor deposition) equipment comes from Tokyo Electron.
Domestic production of chip and display equipment is also hit by the Japan quake, since domestically produced equipment is made of parts imported from Japanese companies like SMC and THK. Korean domestic producers are responding keenly to the current situation in Japan.
SMD is deeply worried about delaying construction of an assembly line for 5.5G AMOLED in Cheonan, South Chungcheong province, since main equipment is imported from Japan.
“If the situation lasts long, operation schedules would have to be changed. Analysts say operations of Japanese equipment plants could be suspended for one month at the shortest to three months at the longest, if the quake effects remain longer,” an official from Samsung Electronics said.
[Written by Dong-in Lee - Su-hyun Song / edited by Soyoung Chung]
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