Freescale Semiconductor Closing Plant Near Sendai, Japan
Austin, Texas-based Freescale Semiconductor Inc. won’t reopen its manufacturing plant near Sendai, Japan, which was heavily damaged in the March 11 earthquake and tsunami.
In April 2009, Freescale announced it would close the Sendai plant in 2011. Before the earthquake and tsunami, the company planned to complete the shutdown of the plant in December 2011. However, the Japanese disaster prompted Freescale to speed up its closure schedule.
The plant sustained extensive equipment and infrastructure damage. Given that damage – along with ongoing safety concerns, the loss of basic services and the continuing quake aftershocks – Freescale decided it was best to shift work that had been done in Japan to other factories.
Freescale didn’t carry earthquake insurance on the Sendai factory, according to EE Times.
The 110,000-square-foot Sendai plant made chips for cars and consumer products.
After the quake and tsunami, Freescale stopped operations at the Japanese factory and evacuated all employees there. Freescale has confirmed that all of its employees and contractors survived the disaster.
Freescale continues efforts to assist its 600 Japanese employees and their families, including formation of the Freescale Relief Foundation.
“In this time of devastating loss for many of our Sendai employees, we want to do what we can to help and to return some sense of stability to their lives,” said Rich Beyer, Freescale’s chairman and CEO. “To that end, Freescale will compensate them through a salary continuation for an extended period of time, coupled with a comprehensive severance package.”
Built in 1987, the Sendai plant originally was a joint venture of Toshiba and Motorola. Motorola’s Semiconductor Products Sector, now Freescale, acquired the property in 1999. The factory is about 80 miles west of the earthquake’s epicenter and about 70 miles north of the troubled Fukushima Daiichi nuclear plant.
In 2009, Freescale said it was shutting down the Sendai plant “in order to remain competitive and maintain an efficient manufacturing footprint.”
Ranked by revenue, Freescale is the world’s 16th largest semiconductor company, according to iSuppli Corp. In 2010, Freescale posted revenue of more than $4.3 billion.