Case Studies
The Impact of Downtime:
Manufacturing Industry
31 July 2024
Halting the Production Line
In manufacturing, power outages can disrupt production lines, causing significant operational downtime and financial loss. Continuous power is vital for operating machinery and maintaining quality control. Any disruption can have ripple effects throughout the supply chain.
Case Study:
On April 3rd, Taiwan Semiconductor Manufacturing Company (TSMC), the world’s largest semiconductor manufacturer, faced a major challenge when a 7.2 magnitude earthquake struck Taiwan. Despite being on the West Coast, TSMC's facilities experienced power outages, leading to a temporary operation halt. The earthquake, the strongest in 25 years, resulted in seven fatalities and over 700 injuries island-wide, highlighting the earthquake's severe impact (Trueman, 2024).
TSMC, which supplies major companies like Nvidia, AMD, and Apple, faced potential supply chain disruptions. Analysts estimated a $60 million impact on TSMC's earnings due to the slowdown in production. Despite some equipment damage, TSMC's robust disaster management protocols enabled rapid recovery. Within 10 hours, over 70% of wafer fab equipment and 80% of new fabs were operational, minimising disruption (Trueman, 2024).
Impact:
The 7.2 magnitude earthquake caused power outages and halted operations at TSMC, leading to a significant financial impact estimated at $60 million. The earthquake also resulted in seven fatalities and over 700 injuries across Taiwan.
Response:
TSMC’s robust disaster management protocols enabled a rapid recovery. Within 10 hours, over 70% of wafer fab equipment and 80% of new fabs were operational, minimising the disruption.
Lesson:
The importance of having strong disaster management protocols in place to ensure quick recovery and minimise operational downtime and financial losses in the event of natural disasters.
