After Japan's Quake, Taiwan Helps Fill iPad 2 Supply-Chain Gaps

RedEaredSlider writes "Like many device manufacturers, Apple cannot seem to escape supply concerns in the wake of the ongoing crisis in Japan. The company is hoping that AU Optronics will fill the void left by companies like Hitachi and Toshiba, both of which have been affected by the series of disasters that have rocked Japan. Damage to many factories from the earthquake and an ongoing nuclear disaster has disrupted supply chains and caused large slowdowns in production of vital electronic components."

Good.

[MrEricSir]

It's a good thing we have our priorities in order.

Oh stuff it

[Sycraft-fu]

The world does not stop because of a disaster. We don't all quit what we are doing just because something bad happens. Companies still need to keep selling their stuff, the world economy needs to keep moving.

Further, one of the things Japan needs is for their stuff to be in demand, so they can get their industry up and running again and make money to help pay for the cost of all this.

Re:Oh stuff it

[MozeeToby]

If the world economy stops moving you get people losing their jobs and their homes, and eventually going hungry on the streets. It doesn't matter if you have the most ethical company in the world, they aren't going to be able to keep paying their employees if they aren't selling their products.

Re:

[geekoid]

What problem?

Re:

[Hazel Bergeron]

You can look at it two ways depending on how sociopathic you are:

(1) If your system may result in people going hungry on the streets, other than because of a lack of food and buildings, then there is automatically a problem. There's your humanitarian angle;

(2) If the world economy stops then there are no enforceable debts, so no justification for pushing anyone out of their home. But when people consider "the economy stopping", it doesn't matter whether the knife falls on the melon or the melon on the knife

Re:

[ackthpt]

If the world economy stops moving you get people losing their jobs and their homes, and eventually going hungry on the streets. It doesn't matter if you have the most ethical company in the world, they aren't going to be able to keep paying their employees if they aren't selling their products.

So much for John Lennon's Imagine...

Re:

[nomadic]

Furthermore, we do not all live in a yellow submarine.

Re:

[cobrausn]

In addition, Lucy is not in the sky and she does not posess diamonds.

Re:

[The Grim Reefer2]

In addition, Lucy is not in the sky and she does not posess diamonds.

Only if you choose the red pill.

Re:

[Hazel Bergeron]

'Imagine' was just as idealistic

Perhaps you missed the word "Imagine" in the song's title. It's an ideal to look to. At no point does the song say, "These are our targets by date X. If we don't achieve all of them globally then we have failed."

and completely invalid

Every sentiment in the song is invalid? So we shouldn't strive for less "necessary" death, less religion, less hunger, more peace?

Now, imagine there is no need for greed. Imagine we have reached the point where technology can keep every man comfortable and fed without the oft-claimed organisational

Re:

[Hazel Bergeron]

scientific understanding of what makes us human; I don't think Lennon had exactly that in mind when he wrote the song.

"Imagine no religion", probably the most loudly repeated line in the song, is to imagine a scientific rather than mystical understanding of what makes us human.

That's a necessary but not sufficient condition for the rest, of course.

Re:

[account_deleted]

Comment removed based on user account deletion

Re:

[Hazel Bergeron]

Or maybe not every song's sentiment completely reflects the opinions of the writer. Or maybe not everyone's choice of entertainment reveals their underlying beliefs.

Re:

[Antisyzygy]

Capitalism will never fulfill that role. Its totally opposite human nature. Though the average American is richer than the average Somali, the disparity between a rich American and a average American is huge, so you have average people that can afford to eat and have a tv and car, but the rich can buy up all the property and other assets and charge people to use them (thus getting richer by taking more money from the average people), or excluding the peons from it all together (like what is happening at ski

Re:

[Pinky's Brain]

Except due to globalism, overpopulation and the carefully engineered lack of independence in pretty much every economy in the world (very few countries are both energy and food independent) capitalists have entrenched themselves better than ever before. A local uprising is harder to pull off now, look at how Iceland got put on the terrorism watchlist when they didn't immediately bail out the banks, and with modern technology they can set up a security machine Stalin could only have dreamed of.

Re:

[The Grim Reefer2]

Now, imagine there is no need for greed. Imagine we have reached the point where technology can keep every man comfortable and fed without the oft-claimed organisational "necessity" that is financial incentive to innovate/invest. The "economy" is alleged to be necessary to manage scarcity - today especially including artificially created scarcities. Imagine there's no scarcity of essentials.

Now, imagine our management of resources is so bountiful that we no longer feel the need to hoard - instead, we can share.

Imagine can be read two ways:
(1) Imagine we're communist;
(2) Imagine capitalism's fulfilled the promised role of technological advancement to the point that we're all educated, rational, comfortable and want for nothing.

(3) Zepherin gets his drunk ass out to that missile silo and finished the warp drive already!

Re:

[crafty.munchkin]

A Perfect Circle's cover of it from a few years ago, played in an octave lower and with Maynard's haunting vocals is far more appropriate for today's world environment.

Re:

[fidget42]

You don't have a job, do you?

If companies waited until Japan can back to production then they would have to lay people off, which would have a severe ripple effect in your local economy.

Re:

[geekoid]

No he does not. He is simply stating that people still need to do stuff. People still need to buy stuff. You act as if the world can only do one thing at a time.

Those 'rituals' happen so we can keep goos flowing, people employed, and so on.

Re:

[cobrausn]

Those 'rituals' happen so we can keep goos flowing...

Wait, what 'ritual' are we talking about here?

Re:

[MobileTatsu-NJG]

Companies still need to keep selling their stuff, the world economy needs to keep moving.

You speak as if "the world economy" were some sort of religion with rituals which must be adhered to for the good of the Invisible Hand.

Sadly, entirely appropriate.

Pardon us for preferring that we have roofs over our heads.

Re:

[Captain Spam]

The world does not stop because of a disaster. We don't all quit what we are doing just because something bad happens. Companies still need to keep selling their stuff, the world economy needs to keep moving.

Perhaps, but do we really need to have the basic logistics of one single — albeit trendy — company as front-page news? "FLASH: THIS JUST IN: McDonald's says they will stop buying beef from known mad cow disease-infested farms for the duration of the outbreak, and... *gasp* oh my god... can it be? It is! THEY'LL START BUYING FROM FARMS WITHOUT MAD COW DISEASE OUTBREAKS!!!!!"

THAT'S the issue with this article. That there's apparently an audience so concerned with not getting their gadgets even

Re:

[MrEricSir]

Yup, you nailed it.

But as if often the case, my post is getting modded down as it suggests that Steve Jobs' latest sneeze may not be newsworthy.

Re:

[bar-agent]

But as if often the case, my post is getting modded down as it suggests that Steve Jobs' latest sneeze may not be newsworthy.

Wait, he sneezed? OMG OMG why didn't anyone tell me?!! DAMN YOU MASS MEDIA!

Re:

[ColdWetDog]

Really? Slashdot talks about 'important stuff' only? Hell, most of the submissions here are about things along one tiny edge or another of human endeavors. Linux? EFF? What Microsoft did or did not do last century?

While I agree in general that whether or not anyone ever gets another iPad pales in significance to issues around the tsunami, we've already beat that one up today. Don't take everything so seriously. You won't make it out alive.

Yes, Good.

[xMrFishx]

Well the thing is, money into Japan will help to some extent. Companies that need to fund repairs need money from somewhere. Companies with money may put it to good (useful) use elsewhere in Japan. So you can't say getting buisness is a bad thing. Factories have to work, or people don't get paid and can't eat. Work from Apple will at least be reliable and in large volume, probably at a premium too. Some money is better than no money in a country facing crisis.

Re:

[DarkOx]

Um you realize the article is about Apple moving orders away from Japan to AUO which is a Taiwanese company that Apple thinks is in a better position to fill them.

Mind you I am not knocking Apple, if you have a supply who can't deliver why is not your problem you find a new supplier.

Re:

[xMrFishx]

No some how I managed to miss that. That's what happens when you try to post whilst having someone wittering at you from across the room... It was good in theory.

Re:

[geekoid]

Japan won't get money for orders it can't fill.

And that goes far beyond the iPad. IN manahatten there is a bridge that uses special metal pieces. Up to now they have been made in just one place: A small shop in Japan.

That shop can no longer get the raw materials to build that part.

Do we let the bridge collapse because the guy in Japan won't get materials for months, or do we go elsewhere for the part?

Of course if the US wasn't so stupidly invested into just in time delivery of goods, we could wait it out an

Re:

[xMrFishx]

Yeah I had a reading comprehension fail on the location, apologies. But as both of you have said, businesses must continue to work, else the production stalls and causes economic issues elsewhere by not making sales or having market issues due to lagging production cycles. I guess this is the way of the monsters we have made, called corporations which must be fed.

Re:

[antifoidulus]

And unfortunately for Japan, the consequences of this will extend far into the future. If other countries start to bring capacity for these parts online, then buyers may not switch back to sourcing them from Japan even after the factories recover. The insanely strong yen only aggravates the situation, it will be much harder for Japan to compete.

Re:

[jrumney]

If the bridge is going to collapse because they can't get spare parts for a month or two, then I say let it collapse and build a lower maintenance one in its place.

HypotheNews Theorem

[srussia]

Between two hot stories, there is an angle, no matter how obtuse.

Re:OH THANK GOD

[narcc]

What would we do without iPad 2s!?!?

I know! the iPad 2 is the most important technological development since man first learned to create Fire. (It's 33% *thinner* for goodness sake!)

Without a steady supply of iPad 2's, civilization would collapse overnight. It's miraculous that we managed to survive as long as we have without this vital technology.

Re:

[Guybrush_T]

Without a steady supply of iPad 2's, civilization would collapse overnight.

I didn't know Civilization had been ported to ipad ...

Re:

[geekoid]

Stop with the knee jerk and think.

This story is NOT ABOUT THE iPad. It only mentions it as an example. There will be world wide consequence in electronic* because of this disaster. That is something relevant to nerds.

*and many other industries.and by many, I mean All.

ipad ... vital?

[Anomalyst]

I don't think that word means what you think it means.

Reading comprehension

[geekoid]

epic fail..

The parts the had been made in Japan were vital to building the iPad.

Not that iPads are vital.

First things first

[93 Escort Wagon]

Let's worry about Japan's recovery from the disaster, and the toll it's taken on the Japanese people. I can stand to wait a little longer before I buy a tablet (or replace my laptop, for that matter).

Think about it from their perspective

[rwade]

I guarantee you the last thing that the Japanese want is for us to stop wanting their stuff real bad. Charity and well wishes about the "toll it's taken" on them will only go so far.

Re:

[Yvanhoe]

The sound I get from people living in Tokyo is exactly that : "stop consider us as victims, we want life to come back to normal, let's have business as usual". Of course I guess that the mood is different in the Sendai region.

Re:

[timeOday]

I guarantee you the last thing that the Japanese want is for us to stop wanting their stuff real bad.

Sure, if you stayed home sick and your boss said, "don't worry, take all the time you like, we don't need what you do," you wouldn't feel too secure.

But you also don't want your boss to say, "we can't wait for you to recover, you're fired, we'll already found else." Which is what just happened here.

Re:

[jrumney]

I'm pretty sure its not good for the Japanese for us to want their stuff so bad that we'll go to Taiwan to get it made when there is a temporary supply problem. Some percentage of these temporary changes in supply chain to meet demand are going to become permanent, perhaps a significant percentage if the price is right and they can sort out the quality issues.

Re:

[geekoid]

so what? the people in Taiwan should just stand around doing nothing? Please. The world does more then one thing at a time.

The fact that it can be picked up so quickly is an interesting note considering the global market.

Something else that was ,once again, brought to light is the problems with just in time services.

Re:

[thesandtiger]

What, exactly, does thus article prevent you from doing that you otherwise could be doing to help? And why did you post here instead of doing that or anything else that would be a higher priority?

You did it because even though your post claims otherwise, you do realize you can do multiple things at the same time. So spare us the false piety, please.

Re:

[pympdaddyc]

Right, because if Apple had everything built and assembled in the US, we definitely would have people like you instead complaining about how expensive Apple products are.

Very good

[countertrolling]

An iPad in very pot.. The only thing to fear is... As Commander-in-Chief of the Army and Navy, I have directed that all measures be taken for our defense...

Sandy Bridge Upgrade Delays...

[rwade]

I've been looking forward to building a new Sandy Bridge system and the disaster in Japan has thrown quite a wrench in it, I'm afraid. The high-quality Asus and MSI motherboards are, of course, assembled in China. However, it is my understanding that the high-quality capacitors and some of the other vital components in the boards are manufactured in Japan.

The revision 3 boards -- with the cougar point SATA issue resolved -- have been in short supply since...well, up to now. I was anticipating several months of supply -- oversupply, specifically -- to knock down the price of the boards, some of which are selling _above_ MSRP -- particularly the Asus P8P67 Pro. From what I understand, Asus, MSI, gigabyte, and the rest are having enough trouble just getting boards to folks that RMA'd their original boards, which is why so few are in the retail channel.

That, of course, leads me to the fear that the Japan-related supply shortage shoe has yet to drop. Kind of sucks.

Then again, I didn't loose my house...

Re:

[Coren22]

I suppose thier houses are kind of loose, possibly from the water washing away from the foundation, but did you mean that you are glad you didn't lose your house?

Re:

[Kakari]

haha. and you can't spell "their".

There's just something about correcting someone's grammar/spelling/diction/etc. that guarantees that you'll screw up something in the process.

Re:

[Coren22]

Yup. For whatever reason the spellcheck didn't show on that one. Though I should just say woody and move on :)

Re:

[Coren22]

Hmm, annoying android spellcheck didn't like "woosh"...oh well.

What about quality?

[jackd]

This could easily have extended consequences for the quality of the devices that are put in the market over the next 1-6 months. New possibly untested stopgap suppliers, providing technology condensed sensitive parts. This won't just affect Apple, many manufacturers will get hit by this. Would be interesting to see stats for returns from some of these companies over the next few months.

Exactly -- Taiwan suddenly being considered..?

[rwade]

Good point. Japan hasn't been a low-cost manufacturing location for a long, long time. That begs the question of why not go with Taiwan production even before the quake. I think that you're onto the answer to that question with your post...

Re:

[rwade]

Could be that a Japanese supplier was the only one that could guarantee a required volume.

So the question, then, is -- why can Taiwanese suppliers not guarantee a required volume? It's not as if they don't have a large enough workforce to support this kind of production. I would suggest that production technology in Taiwan is behind the state-of-the-art used in Japan. I would also suggest that training of production personnel and engineering oversight hasn't gotten Taiwanese personnel to the same level as those similar actors in Japan.

In any case, I'm thinking that parent's (jackd's) original hy

Re:

[MemoryDragon]

A good deal of taiwanese companies has outsourced to china already or opened factories there. So the workforce definitely is not that much of a problem.
But quality still is I guess.
The japanese to some degree managed to ramp up the quality when the mass manufacturing of low price electronic goods went to taiwan.

Re:

[Altus]

My company's hardware is assembled in China, however, many of the base electrical components, switches, capacitors and such, are manufactured in Japan. The assembly lines in China cant build what we need if they can't get the parts.

Re:

[readin]

My company's hardware is assembled in China, however, many of the base electrical components, switches, capacitors and such, are manufactured in Japan. The assembly lines in China cant build what we need if they can't get the parts.

I'm not sure I see your point. Like Japan, Taiwan does a lot of high-tech manufacturing. Like Japan, Taiwan outsources a lot of low-skilled assembly work to China and other places in Asia.

Re:Exactly -- Taiwan suddenly being considered..?

[tftp]

Like Japan, Taiwan does a lot of high-tech manufacturing.

There is more than one level of high-tech manufacturing. It's one thing to take a 0402 capacitor and put it onto the PCB. It's a very different thing to make that capacitor from microscopic parts in the first place. Do you think there are no trade secrets in ceramics that allow you to cram a few uF [digikey.com] into an 0402 part? (Murata [murata.com] is a Japanese company.) Even this tiny segment of passives is dominated by US and Japanese manufacturers (TDK, Taiyo Yuden, Kemet, Panasonic, Murata.) Even AVX, a very solid US manufacturer, has nothing to offer if you need 4.7uF in size 0402.

Companies like Panasonic-ECG and Rohm are doing very well, and they are producing very cost-competitive components. If you are looking for a low cost surface mounted aluminum capacitor, Panasonic is the most likely manufacturer.

Re:

[readin]

Good point. Japan hasn't been a low-cost manufacturing location for a long, long time. That begs the question of why not go with Taiwan production even before the quake. I think that you're onto the answer to that question with your post...

Taiwan hasn't been low cost manufacturing for a while also. It's a developed country that does a lot of high-tech manufacturing.

Re:

[jrumney]

The article is not clear, but it seems that AUO were already supplying half the LCDs for the iPad 2, with Toshiba, Hitachi, Samsung and LGD also named in the article (the latter two specifically as display suppliers). So it seems Apple already had their bets hedged with multiple suppliers, and AUO is just increasing its share (probably along with Samsung and LGD) to cover the shortfall from the Japanese suppliers. Quality should not be affected, as they are an existing supplier, not a new unknown one.

About time

[Charliemopps]

Thank god for that! Those damned Japanese not showing up to work because they're trapped under buildings, washed out to sea or irradiated by the folly of man... how dare they!!!

really?

[nataflux]

An ipad is not a vital piece of equipment, a computer hardly is in this situation. Why does this article even exist?

Re:

[jo_ham]

No, but the parts that Japan's damaged factories can no longer make were vital to the construction of the iPad. That is what the sentence means. It doesn't mean that iPads themselves are "vital".

It's also talking about a wider context, covering a large number of electronic devices - Japan makes a significant number of components for all sorts of things.

In other news, 20,000 dead from massive tsunami

[mmj638]

There are 20,000 bodies that have not been properly laid to rest.

Is a potential iPad 2 shortage really that serious?

I'm just saying. It's like worrying about a lack of, I dunno, parking spaces right after the September 11 attacks.

Re:

[rwade]

There are a lot of stories to be told. Not everyone has to tell the same one. I'm sure you didn't find out about that 20,000 based on your own research or based on desperate missives on the red cross website. I'm betting that you read it in a news story. The fact that you read it means that it was covered. So someone covers the 20,000 bodies and now slashdot is covering the business and economic impact of those the electricity outages. What exactly is wrong with that?

Re:

[Mr. Flibble]

There are 20,000 bodies that have not been properly laid to rest.

Is a potential iPad 2 shortage really that serious?

I'm just saying. It's like worrying about a lack of, I dunno, parking spaces right after the September 11 attacks.

And if you did feel like the lack of parking spaces was not something to worry about, it was a sign that the terrorists had won.

It is like that great British slogan used now, but not during the war: "keep calm and carry on".

It is one thing to show respect. Do like many of us have and show respect by donating to the Red Cross. But not carrying on with your life? That does not help the people in Japan at all.

Get your priorities right

[optymizer]

Oh no! People are dying in Japan! Radiation is everywhere! Jesus, please help those poor souls who have pre-ordered an iPad2 and are now so upset with Apple.

bad neighborhood

[rahunzi]

Was at a conservative think tank in DC today. Coincidently, forum was on Taiwan's (Republic of China ROC), dealings with PRC (Mainland, Communist China). Lots of security stuff. One guy (who really know his s**t and had seen lots of Chinese goodies) resembled Gust Avrakotos in Charlie Wilson's war (played by Philip Seymour Hoffman). No one mentioned Japan and the manufacturing crash in high-value technical devices. So I emailed one guy who was on the panel a couple of questions afterward: "2. What effects

It's over

[mysidia]

Now Today... is Go Forward (and Stop backing up) day.