Suppliers are using second sources; minimal impact felt from the disasterAlready strong demand for NOR ﬂash is being inﬂated further by the Japanese earthquake and tsunami, with fear of short supplies driving buyers to snap up parts in order to ensure they have enough resources and supply for the future. As a result, IHS iSuppli research indicates NOR shipments will rise a healthy 7.5 percent in 2011.
True, the disaster initially generated deep concern in the electronics supply chain, with many fearing it would represent a major blow to the NOR market. However, major manufacturers so far have issued statements professing minimal impact from the crisis.
The projected NOR unit shipments this year of 4.6 billion units represent growth from 4.3 billion units in 2010. By 2015, NOR shipments are forecast to reach 5.8 billion units, equivalent to a compound annual growth rate (CAGR) of 6.3 percent.
One big concern across the semiconductor industry is the temporary shutdown of 25 percent of global wafer production from plants belonging to Shin-Etsu Chemical Company and MEMC Electronic Materials. Wafers represent the most critical raw material used for semiconductor manufacturing.
For its part, Spansion issued a statement saying it is utilizing its Austin, Texas, facility as a second source for the Aizu fab, which already had planned to ramp down from 15,000 to 10,000 eight-inch wafers per month by year-end even before the disaster struck. With a total capacity of 120,000 wafers per month in Austin—about 20 percent typically slated for NOR—Spansion has few supply constraints, as the company continues to enjoy a resurgence.
Other Suppliers OK
Similar reassuring statements have been issued by other companies, including Macronix, which said it had secured additional supply despite already having a healthy inventory. Macronix also stated that its supply chain has suffered little damage from the earthquake, as the facilities the company inherited from Silicon Storage Technologies remain unharmed.
Meanwhile, NOR maker Toshiba said most of the damage it incurred affected the logic IC and display lines. Most of Toshiba’s NOR operations are limited to implementation into multi-chip packages (MCPs).
Supply Issue No Problem
Should a prolonged supply shortage occur, IHS believes that Winbond and Macronix are among the NOR manufacturers with significant available capacity to fill the gap. Winbond has lower utilization rates, as its swiftly expanding NOR and mobile DRAM production is not enough to make up for the transition from DRAM.
But in any event, production shortfalls at the chip level are likely to be short-lived, given that NOR is in the middle of die shifts to accommodate the projected 17 percent shipment growth of serial peripheral interface (SPI) NOR to 2.5 billion units.
Read More > Japan Disaster Affecting Wafer Supply