Sanken Electric will close a factory!
Recently, Sanken Electric, a well-known Japanese component company, said that it will close the Shiga factory of Ishikawa Sanken (Shiga Town, Ishikawa Prefecture) at the end of April 2026. The factory was damaged in the Noto Peninsula earthquake in January 2024.Japan is a country prone to earthquakes, but it also gathers many semiconductor companies with extremely high requirements for the production environment. Therefore, every earthquake in Japan may not only cause problems in the global semiconductor supply chain, but also pose a dual challenge to capital and operations for the company itself.
Sanken Electric will close the Shiga factory
According to Sanken Electric, the Ishikawa Sanken Shiga factory (Shiga Town, Ishikawa Prefecture), which was damaged in the Noto Peninsula earthquake, will be closed in late April 2026. The closure of the factory is due to the impact of the January 2024 earthquake, which makes it difficult to use related facilities.
According to Sanken Electric's explanation: According to the results of the earthquake disaster impact assessment, the factory is difficult to use permanently, so we will close the factory. By the end of April 2026, the products produced by the Shiga factory will be transferred to other Ishikawa Sanken factories and domestic and foreign production bases, and some products produced by Ishikawa Sanken will be discontinued.
Ishikawa Sanken is the main factory for the back-end processing of power semiconductors of the Sanken Electric Group, and has three factories on the Noto Peninsula: Shiga Factory, Horimatsu Factory (both located in Shiga Town, Ishikawa Prefecture), and Noto Factory (Noto Town, Ishikawa Prefecture). These three factories were damaged in the Noto Peninsula earthquake in January 2024, but the Sanken Electric Group continued to carry out early recovery activities and resumed full production in late March of the same year. The company has since been conducting an earthquake impact assessment on the Shiga Factory.
Due to the closure of the Shiga Factory and the scrapping of fixed assets such as factory buildings, Sanken Electric is expected to record an abnormal loss of approximately 1 billion yen in the second quarter of the fiscal year ending March 2025. Regarding the recording of expenses such as equipment transfer/scrapping related to product transfers, the company stated: "We plan to record these expenses based on future progress and will disclose matters that should be disclosed as soon as the situation becomes clear."
The company plans to announce the full-year consolidated earnings forecast for fiscal 2024, including the impact of the incident, at the same time as the second quarter financial results for fiscal 2024 are announced.
Frequent earthquakes in Ishikawa, Japan
Ishikawa Prefecture is one of the three prefectures in Hokuriku, Japan. It is located on the coast of the Sea of Japan in the middle of Honshu Island. It forms a cluster related to the manufacturing of scientific and technological materials and electronic equipment with Niigata and Toyama prefectures, including EIZO Co., Ltd., SB Technology, KEC, International Electric, etc. The information technology industry in Ishikawa Prefecture is on par with the machinery, textile, and food industries, but it is mainly characterized by small and medium-sized enterprises.
On the afternoon of January 1, 2024, a magnitude 7.6 earthquake occurred in the central and northern regions of Japan, with the epicenter located in Noto, Ishikawa Prefecture.
Due to its high-precision characteristics, semiconductor production has extremely high requirements for vibration environment control, especially in semiconductor manufacturing processes such as lithography, etching, and ion implantation. Small vibrations may cause the yield of wafers on the production line to decrease, and medium and large vibrations may even damage manufacturing equipment. It is necessary to repair equipment and debug production lines before resuming production. Moreover, based on the process characteristics of semiconductors, production parameters must be reset after production is stopped. Therefore, all products that have not been completed before the suspension of production are discarded, which not only brings losses to enterprises, but also further aggravates the shortage in the market.
Although Japan has rich experience in emergency management for earthquake disasters and the factory itself has a complete earthquake-resistant design, earthquakes will cause supply fluctuations in the semiconductor market in the short term. In the long run, it will also test the ability of companies to layout their global territory and avoid production dependence on specific regions.
