* Toshiba LCD plant shut for a month for repairs
* Hitachi also halting LCD production at plant near Tokyo
* Lenovo says worried over parts supplies next quarter
* Taiwan gov't could cut tariffs on components to cope
* Toshiba shares end steady; down 30 pct this week
(Adds detail on Maxim disruption)
By Tim Kelly and Melanie Lee
TOKYO/SHANGHAI, March 17 Toshiba Corp (6502.T)
said an assembly line in Japan making small liquid crystal
displays would be closed for a month, and PC maker Lenovo Group
Ltd (0992.HK) voiced worries over parts, highlighting the
threat to global supply chains from Japan's devastating
Hitachi Ltd (6501.T) also said production of small LCDs
will be halted at its factory near Tokyo for a month as it
deals with damage and power outages stemming from last week's
9.0 magnitude earthquake.
The closures are the latest in a series of plant shutdowns
by Japanese companies following the earthquake, tsunami and
subsequent nuclear fallout threat, which threaten supplies of
everything from semiconductors to car parts to manufacturers
across the globe.
Any lengthy disruptions to regional production networks
could spill over into global supply chains, potentially putting
a dent in corporate profits and economic growth more broadly --
worries over which have been reflected in falls in global share
Toshiba's assembly line at a plant near Tokyo making LCDs
for smartphones and other devices will be closed to repair
sensitive equipment knocked out of alignment by the quake, a
Toshiba spokeswoman said on Thursday.
Another plant in Japan making small displays was undamaged,
The Toshiba plant supplies the mobile phone industry and
auto makers for navigation displays, and its two factories
including the one still operating account for about 5 percent
of the global small LCD display market, said Damian Thong, an
analyst at Macquarie Capital Securities in Japan.
"Given that car production in Japan is down anyway, a
one-month stop in production may not be as problematic as it
might seem," Thong said.
"However, given that the market for smartphones outside
Japan is pretty active, supply disruptions there could cause
problems for some handset makers of some models."
Japan disaster in figures r.reuters.com/ser58r
Japan Earthquake Top News page [ID:nTOPNOW4]
Quake impact on auto makers, electronics [ID:nL3E7EG1CK]
Toshiba shares, down over 30 percent this week, closed 0.9
percent weaker on Thursday. Toshiba is a sprawling conglomerate
that also made some of the reactors at the stricken Fukushima
nuclear plant, north of Tokyo.
NOTEBOOK BATTERIES IN SHORT SUPPLY
Chipmaker Maxim Integrated Products (MXIM.O) and Lenovo,
the world's No.4 personal computer brand, joined a growing list
of companies in a range of industries warning of disruptions to
"In the short term there won't be much impact. We are more
worried about the impact in the next quarter," Lenovo Chief
Executive Yang Yuanqing told reporters in Shanghai on
Sunnyvale, California-based Maxim, which makes widely-used
analog chips, said a power outage has affected its Seiko Epson
partner plant in Sakata and that it is shifting production to
Lenovo shares were down 4.1 percent in late afternoon
trade, underperforming the broader Hong Kong market, which was
down 1.9 percent .HSI.
The supply of batteries for notebook PCs in particular
could come under pressure, as key suppliers such as Sony Corp
(6758.T) have shut down a number of factories in Japan, said
Michael Clendenin, managing director of RedTechAdvisors, a
technology research firm based in Shangahi.
"Sony and Sanyo 6764.T would be two of the key suppliers,
and Sony has essentially shut down five or six of its factories
in Japan so that's clearly going to cramp the battery supply
for notebook PCs, where you see Lenovo making a big push these
days. It's going to cast a lot of uncertainty over their Q2
ability to make shipments," Clendenin said.
Even if PC companies such as Lenovo wanted to turn to
suppliers in other countries, questions would remain over how
much capacity they would have.
"If everyone is turning now to these secondary or back-up
sources at the same time, the back-up source is not going to
have the capacity to handle everything."
TAIWAN COULD CUT TARIFFS
Ericsson (ERICb.ST), Alcatel-Lucent ALUA.PA and chipmaker
STMicroelectronics (STM.PA) all warned of a likely impact on
supplies this week, echoing fears raised in the auto industry,
where the closure of major Japanese car and parts plants could
affect U.S. carmakers in as little as two weeks.
Some governments have also started to mull measures to
The cabinet of Taiwan, whose economy is highly dependent on
the high-tech sector, said on Thursday it would consider
cutting tariffs on components for electronic products if supply
shortages developed as a result of the Japan earthquake.
"The impact from the earthquake has been limited as most
companies have inventories at hand. But we're closely watching
the power disruption situation in Japan. If necessary we'll
consider lowering import tariffs on components," said Lien
Ching-chang, deputy director general of the Industrial
Development Bureau of the economics ministry.
He did not elaborate about what components' tariffs would
be slashed or how big the cuts would be.
Many of Taiwan's tech firms make PCs and electronic gadgets
for major brands such as Apple Inc (AAPL.O).
(Additional reporting by Faith Hung and Argin Chang in Taipei,
Noel Randewich in San Francisco; Writing by Jason Subler;
Editing by Lincoln Feast, Dave Zimmerman)