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To: Proud_Infidel who wrote (32660)	9/30/1999 10:51:00 AM
From: Proud_Infidel	Read Replies (1) \| Respond to of 70976

[Taiwan Quake] PC Makers Suffer Parts Shortages, May Last For Months September 30, 1999 (TAIPEI) -- The power outages and parts shortages resulting from Taiwan's Sept. 21 earthquake will hurt the fourth-quarter production value of Taiwan's information technology industry. Supply of electricity has been fully restored at the Hsinchu Science-based Industrial Park, where many of Taiwan's semiconductor manufacturers are located. Meanwhile, most IT product makers are concentrated in northern and southern Taiwan, at least 100 km from the quake's epicenter. They suffered only limited damage. Still, rotating black-outs are scheduled for many areas, and are anticipated to last for two more weeks, and this is taking a toll on production and yields. Unreliable electricity supply has forced Taiwan's desktop PC makers to ship products through overseas plants, mainly from China, to meet orders from international clients like Compaq Computer Corp., NEC Corp. and IBM Corp. The Taiwan-based companies that are impacted include Acer Inc., Quanta Computer Corp., Arima Computer Corp., Compal Electronics Inc. and Inventec Inc., among others. However, not all IT products can be made in China. For fear of cultivating unfriendly competition, Taiwan's regulations prohibit local businesses from setting up assembly lines in China for making notebook PCs as well as Pentium PCs or higher versions. The capacity of Taiwan's notebook PC industry has reached as high as about 50 percent of worldwide production. However, shortages of large-size LCD modules, now compounded by a disruption of electricity, may result in a time of slow growth when foreign clients begin to hedge risks by diversifying their sources of notebooks. Electricity has been restored to all makers of thin-film transistor liquid-crystal displays (TFT-LCDs). They will resume full operation within this week. Before the earthquake, there was already a serious global shortage of small and midsize TFT-LCDs. Some foreign clients are even flying to Taiwan to ensure prompt delivery of such products. The delivery delays may range from two weeks to a month. As for PC peripheral products, CD-ROM drives are another crucial item. The anticipated bottleneck lies in the supply of the driver IC chip. Its unit price already jumped by as much as US$5 on speculation over shortages, jacking the price of a CD-ROM drive over US$35. With the holiday season approaching, industry analysts expect to see a shortage of high-speed drives in Western markets starting in November. However, if PC systems are also in short supply, there won't be an urgent demand for the drives. Shortages of microchips and parts comprise the major headache faced by manufacturers. The two-week production slowdown is extending the parts stock through mid-October. And no one is quite sure after that. This wave of the "industrial impact from the earthquake" affects more players beyond Taiwan-based makers. In Korea, Southeast Asia and the Middle East, many small and midsize PC businesses rely on Taiwan for the supply of memory chips, materials, keyboards and mouse units. If the supply is not back to normal soon, they could miss out on some holiday season business. Taiwan-based makers of connectors have long relocated their production bases to Southeast Asia or China. As a result, their output is hardly affected at all. The so-called "silicon recovery" is the ultimate locomotive that's leading the comeback of Taiwan's electronics industry. With full electricity supply levels available at Hsinchu, the powerhouse of local semiconductor manufacturing, the entire infrastructure of IT hardware production is quickly ramping up again. International clients will stay with local suppliers, analysts say, because of Taiwan's competitiveness and cost-effective approach to business. Some analysts even say that the additional demand jacked by this wave of shortages will push Taiwan's IT industry to surpass the pre-earthquake level in 2000. (Charlene Huang, Special to Asia BizTech)

To: Proud_Infidel who wrote (32660)	9/30/1999 12:58:00 PM
From: Proud_Infidel	Respond to of 70976

[Taiwan Quake] UMC Group Returns to Normal Operations September 30, 1999 (TOKYO) -- Taiwan's UMC Group said the damage it suffered from the Sept. 21 earthquake was limited and that it is nearly back to normal operations. The company reported on the status of its plant operations as of Sept. 27. Power supply is nearly back to full availability, the company said. About 90 percent of UMC Group's manufacturing equipment was back in operation, as of Sept. 27. And the group expects to start full operations in several days. The reported damage to its plants, estimated at US$10 million, mainly came from problems with components such as quartz tubes that are used in manufacturing equipment. However, replacement components have been sent by air shipments, and installation work is almost complete. UMC Group estimates that its output after the quake will decline by 25 percent in the month of September. In terms of sales, it will have a loss of about US$45 million. The group said its casualty insurance would cover most damages and help keep the loss to a lower level than expected. Taiwan Semiconductor Manufacturing Co. (TSMC) announced that it will realize 80 percent of normal production by Sept. 30. Power supply is stable and at the pre-quake levels, and operations are approaching normal, a company official said. (Nikkei Electronics)