While much of the world’s focus is on the fate of Japan’s nuclear reactors, for the tech industry concern is also on the potential fall-out from temporary shutdowns of vital chipmaking plants. With the country a major supplier of silicon chips, the uncertainty may prompt ‘panic buying’ of semiconductors, a situation from which Apple may be uniquely immune.
“Many electronic original equipment manufacturers worldwide could be engaging in panic buying of semiconductors and electronic components,” hardware researcher IHS iSuppli announced Thursday. Several distributors report “a surge in orders” from customers fearing Japan’s 9.0 earthquake could disrupt supplies for everything from personal computers to tablets.
“Currently and in the past, Apple buys key components with large pre-payments that guarantee supply and pricing,” Piper Jaffray’s Gene Munster said. Apple products, such as the iPad 2, include several components manufactured in Japan. The device’s flash memory comes from Toshiba, while the tablet’s Lithium-ion batteries likely come from Japanese-based component-makers, such as Sony, iSuppli said.
To further assure Apple fans there will not be a slowdown in supply, Hon Hai Precision, the company behind Foxconn, announced Friday it expects no problem meeting demand due to the events in Japan. The company said it has backup suppliers in case the crisis last an extended period.
Earlier this week, Apple stock price dropped after JMP Securities downgraded the iPhone maker on concern a slowdown at Foxconn could impact sales of the just-released iPad 2.
