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Japan's LCD biz survives quake and tsunami

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The Japanese LCD monitor industry will be breathing a sigh of relief after analysts trumpeted its remarkable resilience in the months following the twin disasters of massive earthquake and tsunami which struck in the north east region of Tohoku a year ago.

However, it’s not all good news, as a supply chain disaster was only averted thanks to the country having a “limited” presence on the global display stage and the fact that it had a decent amount of inventory to keep it going, according to market watchers at IHS iSuppli.

“A decline in a major country’s market share and a build-up in excess inventory normally are regarded as unfavourable developments for a technology market,” said Sweta Dash, director of LCD research at IHS.

“However, in the LCD market of 2011, Japan’s limited presence in the global supply chain – combined with excess stockpiles in the channel – helped soften the blow of the manufacturing disruptions caused by the disaster.”

According to IHS iSuppli, Japan is far behind some of its rivals on the world stage when it comes to the production of monitors. It could lay claim to just five per cent of large-sized LCD panel capacity and only 18 per cent of small and medium sized LCD displays in the third quarter.

This is small fry compared to nearby Taiwan, which accounted for 40 per cent of large-size displays and 55 per cent of small and medium, according to the market watchers.

Only Panasonic, Hitachi and NEC were affected due to their manufacturing plants being close to where the earthquake struck.

In any case, most vendors had at least a month’s worth of inventory in stock, according to IHS iSuppli.

The situation in Japan’s semiconductor industry isn’t quite so rosy, although it’s nothing to do with the Sendai earthquake of March 2011.

The same analyst firm has argued that Nippon’s semiconductor firms have failed to invest in new production facilities and are therefore woefully ill equipped to meet the growing demand for sub-28 nanometer chips. ®

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