Calling its Sendai facility the “semiconductor fab located closest to the epicenter,” Rich Beyer, Freescale’s chairman and CEO, said that the company has “come to a conclusion that it is not feasible to re-open.”
Noting that “we couldn’t even get inside the fab until 10 days ago,” Beyer said that “we discovered a lot of equipment and machinery was severely damaged and moved, ducts and pipes were broken, and gasses and chemicals were leaked.”
While Freescale had already announced plans in 2009 to close the Sendai fab late this year, the recent earthquake appears to have left the U.S. company no choice but to accelerate its closing. The decision will have serious impact on people working for Freescale in Sendai and Freescale’s customers in the global automotive, networking and industrial markets. The Sendai fab, before the earthquake, was in full production, as Freescale was trying to build inventory before the planned shutdown.
Clearly, coping with a massive earthquake and losing their jobs at the same time literally doubles the hardship for Freescale employees. Beyer made it clear that Freescale will extend to all of its 600 employees and 175 contractors working at the Sendai fab compensation, in addition to the severance package the company had previously negotiated in lieu of the planned closing. “We understand that this is a very painful time for all of them. We hope to help them reconstruct their lives,” said Beyer.
Potentially even more problematic for Freescale is to devise an effective plan to take care of customers affected by the lack of qualified parts and components coming out of Freescale’s Sendai fab.
Freescale produced at its Sendai fab 8-bit microcontrollers, analog parts and sensors (i.e. pressure sensors), according to Beyer. Customers for such parts and components are “pretty much across the board” (not only those based in Japan, but North America and Europe) in the automotive market, and some networking and industrial segments, said