To: Bharat H. Barai who wrote (48695 ) 9/27/1999 9:05:00 AM From: Bipin Prasad Respond to of 53903
By Alice Hung TAIPEI, Sept 27 (Reuters) - Taiwan's Hsinchu Science Park resumed across-the-board operations on Monday after being idled by last week's earthquake, but an official said the microchip industry would need two more days to ramp up to full capacity. Power supplies to Hsinchu -- home to Taiwan's top semiconductor makers -- were back to normal and wafer fabrication lines at nearly 300 manufacturers in the park were all up and running, said park administrator Wang Kung. "We have gradually resumed production since Saturday. By today, all firms are able to start operations," Wang said in a telephone interview. Production was being pushed rapidly back to capacity levels. "It may take about two days for a more sensitive industry like microchip foundry makers to reach full capacity," Wang said. Wang was referring to Taiwan Semiconductor Manufacturing Co <2330.TW> and United Microelectronics Corp <2303.TW> which supply about 65 percent of the world's supply of made-to-order "foundry" chips. Before the huge tremor hit Taiwan on September 21, both had been running at full capacity to meet surging global demand for foundry chips. Though few of the manufacturers suffered significant damage in the earthquake, which registered 7.6 on the open-ended Richter scale and killed more than 2,000 people, production was halted by sweeping power outages blamed on the tremor. "Microchip makers are hardest hit because some their lost production can't be restored," Wang said. Taiwan Semiconductor said production at its five wafer facilities would ramp up on Tuesday to about 80 percent of capacity in two six-inch wafer plants. Production at its three eight-inch wafer plants would return to about 70-80 percent by Thursday. Taiwan Semicon has said the earthquake would not affect its future orders, though September and fourth-quarter sales could be hit. Shares of most microchip makers plunged to the newly narrowed 3.5 percent volatility limit in morning trade on Monday, the first trading day since the earthquake, with Taiwan Semicon down T$4.5 or 3.23 percent at T$134.5. United Micro was down T$2.5 or 3.18 percent at T$76. Wang put initial earthquake-related losses for the entire science park at T$10 billion (US$314 million), due mainly to lost production rather than damage. Wang said his administration hoped to end its reliance on external power supplies by expanding the park's existing steam-electricity co-generation system within two years. "Power supply is our biggest problem right now. We hope to become self-sufficient in two years," Wang said. State-run Taiwan Power Co began rationing power to households and small manufacturers in northern Taiwan on Monday and said this enabled it to achieve its aim of meeting 85 percent of the needs of key manufacturers -- including those at Hsinchu. Such power delivery was a sharp improvement from the first days after the earthquake, when the utility was able to deliver only 10 percent or less. Rationing will be enforced for two weeks, and Taipower hoped to restore full power by October 10.