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Taiwan earthquake: Will Apple’s and NVIDIA’s supply chain suffer

Taiwan earthquake Will Apple’s and NVIDIA’s supply chain suffer

A powerful earthquake in Taiwan has rattled not only the island nation, but also the global technology industry. The 7.4 magnitude tremor, the strongest in 25 years, has caused casualties and infrastructure damage. 

The earthquake significantly impacted the tech world by forcing Taiwan Semiconductor Manufacturing Company (TSMC), a vital supplier of advanced chips to companies like Apple, NVIDIA, and Qualcomm, to halt production at some of its facilities.

Sources familiar with TSMC’s operations have disclosed structural harm at its N3 fab in Tainan. Crucial components like beams and columns have been damaged, according to a Bloomberg report on April 3. 

The situation has resulted in a complete shutdown of production, which includes Extreme Ultraviolet (EUV) machines essential for manufacturing processes below 7nm. Additionally, another facility in Hsinchu reported damaged pipelines and wafers that are unusable.

Potential impact on Apple

Concerns about potential delays in Apple’s product supply chain arise due to these disruptions, as TSMC supplies all of the custom silicon processors in Apple devices.

The uncertainty surrounding the impact of Apple’s upcoming product launches, such as the iPhone 15 Pro, persists. However, significant disruptions could potentially result in delays or limited availability.

TSMC’s disaster preparedness and recovery efforts

With a history of disaster preparedness, TSMC implemented rigorous seismic management measures following a major earthquake in 1999.

Furthermore, the company has promptly taken action to assess the damage and initiate recovery procedures, with expectations of some production lines resuming operation soon.

Global chip shortage concerns rise

Being one of the world’s largest makers of advanced chips, TSMC, along with Taiwan as a whole, produces a majority of the world’s semiconductors. This earthquake compounds the strain on the tech supply chain, prompting concerns about potential disruptions.

Nevertheless, TSMC’s efforts to recover and Apple’s supply chain management strategies could assist in mitigating the immediate effects.

While the tech industry is still assessing the full extent of the damage and the impact, this event highlights how susceptible chip production is to natural disasters.

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