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At least 11 people died and hundreds were pulled from the rubble of collapsed buildings in Taiwan after a 6.4-magnitude earthquake struck an area in the island's southwest that is a hub for electronics makers such as the Taiwan Semiconductor Manufacturing Co (TSMC).
More than 470 people were injured when nine buildings toppled and five tilted after the quake struck at 3:57 am local time on Saturday, according to the National Fire Agency. Water supplies were halted to about 400,000 households across the island, the agency said. The disaster cut power to more than 121,000 residences in Tainan and to hundreds in Kaohsiung, a city to the south, the Ministry of Economic Affairs said. Taiwan is home to some of the world's biggest companies that produce chips for the likes of Apple Inc. and Qualcomm Inc. The island is prone to quakes as it sits on the edge of where the Philippine Sea Plate and Eurasia Plate converge. Plate movements can trigger temblors that can cause disruption or damage to high-precision chip-making equipment. There have been about 79 quakes greater than 4.5 in the area since the beginning of last year, according to a search on the US Geological Survey website.
"Supply chain disruption risk is unlikely as most of the factories should be able to be back to normal in a couple of days, and it's off season in the technology industry," Vincent Chen, president of Yuanta Investment Consulting, said by phone. "It should be manageable with inventories." The temblor's epicentre was in Kaohsiung, about 300 kilometres southwest of Taipei, at a depth of 16.7 kilometres, according to Taiwan's Central Weather Bureau website. There were at least 40 aftershocks from the quake that happened at the start of the Lunar New Year holiday, a time when many people travel in the region.
TSMC said it doesn't expect first-quarter wafer shipments to be affected by more than one per cent. The contract manufacturer of chips to Apple is assessing damage to products that were in the manufacturing process at plants in Tainan, though its initial estimate is that more than 95 per cent of the tools used can be fully restored to normal in two to three days.
Liquid-crystal display maker Innolux Corp said all of its eight factories in Tainan shut down automatically after the quake and that production is being resumed gradually. The company said its four factories in Hsinchu are operating normally.
United Microelectronics Corp Chief Financial Officer Liu Chitung said by phone that there were no injuries or damage at its four chip factories in Tainan, though machines will need recalibrating. UMC will evaluate the impact to operations, Liu said. Corning Inc, a supplier of glass substrate for panel makers with one factory in Tainan, didn't suffer any damage to its facility and it is examining its operation lines, Corning Display Technologies Taiwan President Daniel Tseng said in text message.
Taiwan High Speed Rail Corp said in a text message the quake damaged its systems, and its bullet-train services in the southern part of the island will be disrupted for the rest of the day. The company will announce at 9 pm local time whether normal operations will resume on Sunday.
