Already a Bloomberg.com user?
Sign in with the same account.
Information Technology: Semiconductors
Fast Chips, Faster Cleanup
How TSMC got up and running again after the Taiwan quake
The aftershock in Taiwan's Hsinchu Science based Industrial Park lasts 20 seconds, causing buildings to shake. But the managers of Taiwan Semiconductor Manufacturing Co's No. 2 and No. 3 fabrication factories keep calm. A week after the Sept. 21 quake that flattened 8,000 buildings and killed 2,100 people, TSMC is focused on getting its ultrasensitive chipmaking machines back up. In the past few days, M.C. Tzeng and J.K. Lin, the two engineers in charge of repair, have learned a lot about quakes and damage control. "This one [aftershock] won't cause any harm," Lin says confidently.
News of the quake sent investors and electronics execs around the world to their calculators to estimate possible damages. A disruption in supplies from Taiwan for even a couple of weeks might dim the outlook for sales and profits in everything from computers to cell phones to washing machines. Taiwan's factories produce 4.4% of the world's chips, but account for 56% of chip outsourcing--runs of specialty chips that are vital to dozens of products.
Yet for all the human devastation, the long-term damage to Taiwan's chip industry is expected to be small. TSMC, which had to scrap 28,000 silicon wafers and expects to lose up to 13 days of production--about $88 million in revenue--began recovery efforts 15 minutes after the big quake hit at 1:47 a.m. A crowd of TSMC managers and engineers gathered in the rain outside the two "fab" plants. Within hours, they were telling customers what to expect.TOXIC CHALLENGE. The first priority was to restore power to the factories and to a nitrogen gas plant. Without electricity, there's no way to pump in nitrogen to purge toxic gases from the fabs. "Without power, we can't even inspect the machine to see what's damaged," says Steven Tso, senior vice-president of manufacturing and technology.
In fact, it was a full day before engineers could even enter the fabs. At first, utility officials warned it might take weeks to restore power--an unacceptable disruption. "If we had to shut this down, I don't know how we would ever restore credibility with our customers," says TSMC President F.C. Tseng.
Tseng and Chairman Morris Chang spent hours on the phone telling top government officials--including Premier Vincent C. Siew--they needed at least 25% of normal power to stabilize the fabs. Two days later, they got it. Tseng also began a joint effort with other chipmakers to secure power for the Hsinchu industrial park.
While the top managers dealt with the utilities and government bureaucrats, Tso organized repair of sensitive machinery such as "steppers," the machines that etch circuits on silicon. One of the biggest problems was figuring out how to replace cracked quartz elements inside the silicon furnaces.
Working with other chipmakers, TSMC worked out a system for rationing nitrogen among five plants, thus stretching an eight-hour supply to 24 hours. Once power was restored on Sept. 25, the pace accelerated. Each furnace for baking silicon had to be thoroughly cleansed of contaminants. And since even the slightest movement can cause malfunctions in steppers, each had to be carefully reset and recalibrated. Engineers started working around the clock, camping out in offices overnight.
Tso didn't wait for full power to be restored. Working with just 10% from backup generators, he began cleaning the furnaces, shaving critical hours from the task. "In the U.S., engineers probably would have waited for full power before trying to do that," says Norris.
After a week, four of TSMC's fabs are nearing 90% capacity. The fifth, on the fifth floor of a building, suffered more harm. That puts Tso and group six days ahead of their first guess of how long it would take to recover. Tso says he hopes the performance reassures customers more than the earthquake worried them. It will take more than a few aftershocks to rattle this team.By Jonathan Moore in Hsinchu