Kyushu, once called the forward base leading Japan's semiconductor revival, is shaking from a major earthquake that struck again after 10 years.
When a magnitude 7.1 earthquake hit Kumamoto on the afternoon of the 28th, Taiwan's TSMC's semiconductor plant in Japan, Sony's semiconductor plant for cameras, Tokyo Electron's plant that makes semiconductor equipment, and Honda and Toyota business sites all evacuated employees at once or halted production. Outside the plants, expressways were severed, and rail and air services all stopped. Experts said the quake put to the test Japan's industrial strategy of concentrating semiconductor and auto production capacity in a single region.
On the 29th, the Japan Meteorological Agency named the magnitude 7.1 quake that occurred at 4:27 p.m. the previous day at a depth of 10 km in Kumamoto Prefecture the "Reiwa 8 Kumamoto earthquake." This is the first time since the January 2024 Noto Peninsula earthquake that the agency has named an earthquake. The epicenter this time is about 20 km southwest of the 2016 Kumamoto earthquake's epicenter, and the agency said, "It is not yet known whether the two quakes are related."
Kyushu is home to a concentration of plants from Japan's leading industries, from semiconductors to automobiles. After Mitsubishi Electric built a semiconductor plant in Kumamoto in 1967 and related plants followed, the area was called "Silicon Island." As Japan's semiconductor industry faltered, the Silicon Island reputation faded, but it began to revive after Taiwan's TSMC established its subsidiary JASM in Kumamoto in 2021. JASM is a foundry plant that takes orders to manufacture semiconductors designed by other companies.
Nearby, leading Japanese corporations such as Sony, Tokyo Electron, and Toyota form a cluster (industrial complex). Sony makes image sensors in the area that go into cameras and convert light into electrical signals. Tokyo Electron manufactures equipment used to print semiconductors. According to a draft Kyushu industrial cluster plan released in May by the Cabinet Secretariat of Japan, semiconductors made in the Kumamoto area account for about half of Japan's total production by value.
These plants all stopped at once after the quake. However, among the halted plants, none had buildings that collapsed. Japan legally mandates earthquake-resistant design so that buildings do not collapse even in major earthquakes. The so-called "new seismic standards," applied since June 1981, require a level of resistance that prevents building collapse in quakes with an intensity of upper 6 to 7.
After the Kumamoto earthquake 10 years ago, a full survey of the city center by the Ministry of Land, Infrastructure, Transport and Tourism found that among 759 wooden houses built before 1981, 214 (28%) collapsed, while among 1,196 houses built after that, only 83 (7%) collapsed. All 10 reinforced concrete buildings that collapsed at the time were built to the old standards. Semiconductor plants see production thrown off by even minute tremors. For this reason, they sometimes apply seismic designs that are stricter than the legal standards.
JASM and Sony evacuated employees immediately after the quake. Tokyo Electron Kyushu halted operations on the 29th for safety inspections. Printing and electronic materials corporations Toppan and Fujifilm Kyushu also stopped operations. Honda suspended its Kumamoto motorcycle plant, and Toyota halted operations at three Kyushu plants.
Unlike buildings, manufacturing-related infrastructure encompassing logistics, water, and electricity could not withstand the quake. The Ministry of Land, Infrastructure, Transport and Tourism of Japan said sections of the Kyushu Expressway and the Minami Kyushu Expressway, which connect the cluster in the area, were restricted after the quake for safety inspections. JR Kyushu suspended all Kyushu Shinkansen services from the first train on the 29th. At the hub Aso Kumamoto Airport, flights were grounded as the runway was inspected due to the quake. About 140,000 households lost water in 17 cities and towns in Kumamoto Prefecture, and Kyushu Electric Power Transmission and Distribution said 48,000 households lost power.
Kyushu currently concentrates semiconductor-related talent and existing equipment and parts partners. Abundant industrial water, access to ports and airports, and subsidies from central and local governments are also focused in this region. Experts noted that the current setup, in which plants and partners rely on the same power grid and water and the same expressways and airports, has a critical weakness: in a wide-area quake, multiple production lines stop at the same time.
During the Kumamoto earthquake on Apr. 14, 2016, which was 10 years ago, Sony's Kumamoto plant took more than a month just to recover. In that quake 10 years ago, Sony suffered damage to upper floors of buildings, clean rooms that filter dust, and equipment. Sony did not resume its metrology process, which measures semiconductor conditions, until May 9, nearly a month after the quake. The assembly process restarted on May 17, and the wafer process, which etches circuits onto wafers, resumed sequentially from May 21. The auto industry, where partner suppliers of parts are intricately intertwined, also faced delayed procurement of materials, taking more than three months to restart. Honda's Kumamoto plant did not return to normal production until Aug. 22, more than four months later.
Some said that if recovery across Silicon Island is delayed, the global semiconductor industry could also face disruptions. Tokyo Electron's Kumamoto plant, which was damaged this time, holds technology that is hard to substitute in global semiconductor production. Semiconductors are made by etching circuits onto round silicon wafers; to etch circuits, a photosensitive chemical must be evenly applied to the wafer, exposed to light, and then washed off. Tokyo Electron has a 90% global market share for the coater-developer equipment that performs this process.
Tokyo Electron said it had not identified serious damage to buildings and facilities at its two business sites in Koshi and Ozu in Kumamoto, but it halted operations on the 29th and began safety inspections.
Since the quake, no changes have been detected in schedules for new semiconductor investments in Kyushu, including JASM's second plant. In an email statement to Reuters on the 28th, TSMC said, "After the quake, we completed structural checks and confirmed the building is safe," adding, "Detailed inspections and impact assessments are ongoing."