Japanese Parts Paralysis: And Now, The Great Chip Famine

Bertel Schmitt
by Bertel Schmitt
japanese parts paralysis and now the great chip famine

Automakers in Japan are slowly crawling back to normal. However, they are in for another after shock, and this one could be quite serious: Yasushi Akao, President of chipmaker Renesas said today that supplies of microcontrollers from his company will be in serious trouble come June. According to The Nikkei [sub], “stocks are expected to run out next month as operations at the firm’s Naka plant in Ibaraki Prefecture have been suspended since the Great East Japan Earthquake on March 11.” Renesas microcontrollers are the chips of choice of many car companies who use them in their on-board electronics. Toyota is known to be a large customer of Renesas.

Why the shortage with a 3 months delay after the earthquake? As reported earlier, chips take months to “grow.” The Naka fab of Renesas accounts for about 25 percent of its global automotive microcontroller capacity. It had been closed after the earthquake. Naka is what’s called a “front-end line” fab, which does the early steps of IC production. The fab is scheduled to re-open in June.

But: Chips started from scratch in June will ship sometime in August – if left unimpeded by power outages. The supply that runs out in June is mostly from production that had been started before the quake. There will be a dry season for chips through early fall.

As previously announced, Renesas will ration the chips, or make that, “supply microcontrollers to its customers based on historical business ties,” as Akao put it.

Join the conversation
  • Mr Carpenter Mr Carpenter on May 18, 2011

    I presume that I am correct in reading between the lines, that Toyota will be provided the lion's share of the remaining chips in order to keep production moving. If I recall correctly, one Prius has 16 computers; goodness only knows how many chips total per Prius.

  • OldandSlow OldandSlow on May 18, 2011

    It is going to be an interesting summer, because this doesn't just affect Japanese vehicle manufacturers.

  • Steven02 Steven02 on May 18, 2011

    It would be great to know how many manufactures use these chips from Renesas and in what models. I wonder if any manufactures have looked at second sourcing them from other manufactures.

  • Thirty-three Thirty-three on May 18, 2011

    I wonder if Saab has any parts they could sell. They do need to raise some cash quickly.

    • Norma Norma on May 18, 2011

      I'm confident SAAB just bagged a handsome profit by reselling to GM (which shares their platform). Unfortunately, still peanuts when comparing with their mountain of debt and it's like eating your own flesh and drinking own blood during a famine.