Power cuts halt north Japan plants following aftershock

TOKYO Fri Apr 8, 2011 12:32am EDT

TOKYO (Reuters) - Sony Corp, chip-maker Renesas and Elpida Memory said on Friday production at some plants in northern Japan had been halted again due to power cuts triggered by a major aftershock that shook the region late on Thursday.

The stoppages are the latest blow to hopes of a rapid resolution to the supply-chain woes that have hobbled the manufacturing industry since the devastating magnitude 9 earthquake on March 11.

"It (an earthquake) could happen again and that means you can't really proceed with reconstruction," said Yuuki Sakurai, CEO of Fukoku Capital Management, adding that many firms were hesitant as to how to proceed.

"They have to be very careful. They need thoughtful planning. They need to be doubly, triply solid against the next earthquake. So it will cost a lot and you have to consider whether it is worth rebuilding," he said.

Renesas, the world's largest maker of microcontroller chips and a supplier to the auto industry, said four plants in northern Japan, including two microcontroller factories, had been halted by the power blackout.

A company spokeswoman said it was not clear when manufacturing would be re-started, though power had already been restored to one plant.

Sony said production had been suspended at two plants in Miyagi prefecture. The two sites, which make optical devices and IC cards, had resumed partial production at the end of last month after the disaster.

The consumer electronics giant said output had resumed at a semiconductor laser factory, also in the northern prefecture of Miyagi, after being suspended briefly for inspections.

Elpida, the world's No.3 maker of DRAM chips, said one factory in the northern prefecture of Akita had been halted by the power outage.

The company said on its website there had been no injuries or damage to equipment and the plant would be re-started when power was restored.

Thursday night's magnitude 7.4 quake shook the devastated coast of northeast Japan and Jiji news agency said two people were killed.

Electronics conglomerate Toshiba said the power blackout was affecting a microcontroller chip plant in the northern prefecture of Iwate. It was not clear whether Thursday's quake would delay the re-start of this plant, which is scheduled for April 11, a company spokeswoman said.

Rival electronics firm Panasonic Corp said it was still confirming the status of its northern Japan plants, all but one of which had resumed operations following the March disaster.

In a sign that Japanese companies are still struggling with the disruption caused, Nissan Motor Co said it will suspend production at a plant in the United Kingdom for three days in April due to a shortage of parts from Japan.

Japanese shares were broadly higher on Friday, with Elpida up 1.4 percent and Renesas gaining 3.4 percent versus a gain of about 2 percent in the benchmark Nikkei.

(Reporting by Isabel Reynolds; Editing by Michael Watson and Dhara Ranasinghe)

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