In the wake of a 6.4 magnitude earthquake in Kaohsiung, several major semiconductor fabrication plants have experienced wafer fractures, triggering concerns across the global supply chain. Among the affected facilities is TSMC's Wafer 14 plant, which plays a critical role in manufacturing the Apple A9 processor for original equipment manufacturers (OEMs). With an estimated downtime of two to three days, this disruption could significantly impact Apple's production schedule and its global supply chain.
TSMC's Wafer 14 facility primarily focuses on 16nm and 20nm advanced processes, with the Apple A9 being one of its key projects. Other major clients include MediaTek’s Helio series chips, HiSilicon’s Kirin 950, and Altera—acquired by Intel for $16.7 billion—which produces programmable logic chips at the same facility. The earthquake has led to wafer fragmentation, particularly affecting high-end processes like the 16nm node used for the Apple A9.
The Apple A9 processor is produced using up to 80 layers of wafer exposure, with each layer requiring 3–4 days of work. Any seismic activity during this process can damage the alignment and result in scrapped wafers. Industry estimates suggest that the Apple A9 output is around 37 million units per quarter, with TSMC responsible for approximately 17 million units. Given the time it takes to complete production and deliver the final product to customers, the disruption is expected to begin affecting the supply chain in June and July.
With the potential loss of billions of yuan in output value, the ripple effects of this incident are already being felt. TSMC and UMC have both reported wafer fractures, signaling a serious challenge for the industry. As the company works to resume operations, the full extent of the impact on global electronics manufacturing remains uncertain. This event highlights the fragility of the semiconductor supply chain and the importance of resilience in the face of natural disasters.
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