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Coronavirus

Japan's Murata temporarily shuts key plant due to COVID cluster

Outbreak at electronic parts maker highlights growing risk to manufacturing

Murata has temporarily halted operations at its factory in Fukui, central Japan after the discovery of a COVID-19 cluster. (Source photos by Kaisuke Ota and Murata)

KYOTO -- Murata Manufacturing will close a key plant in Japan until at least next week following the outbreak of a COVID cluster, raising concerns about a potential shortage of electronic components that are used in everything from smartphones and appliances to cars and data centers.

The outbreak occurred at a plant in Echizen, Fukui Prefecture, central Japan, forcing the company to shut the plant to prevent further spread of the virus. As of Tuesday, 98 cases had been reported at the factory where 7,000 people work, including those from partner companies. The plant, run by subsidiary Fukui Murata Manufacturing, will be closed through Aug. 31.

The number of cluster infections in factories has been limited so far in Japan. That is apparently because factories tend to be located in rural areas, where overall infection rates remain relatively low. But experts warn that risks to such plants are now much higher with the spread of more contagious variants.

Murata plans to test all employees at the Fukui plant and start a mass-vaccination program there in September.

Murata says it will rely on inventories to meet customer demand and, if necessary, use other plants in Japan and overseas to make up for the production shortfall.

The Fukui plant produces multilayer ceramic capacitors, in which the company is believed to control 40% of the global market. MLCCs are used in various electronic devices, including smartphones.

Analysts do not expect the production stoppage to cause as serious a disruption to the economy as semiconductor shortages have.

"This is different from a lack of raw materials or production equipment. Once preventive measures are in place, production can resume," said Junichi Makino, economist at SMBC Nikko Securities. But Makino warned that COVD clusters could appear at other manufacturers, which often operate factories in rural parts of Japan like Murata.

Murata reported the first case at the Fukui plant on Aug. 3, which involved an employee from a partner company. The person had dined with others and played sports without a mask, according to public health officials tracking the source of the outbreak.

Employees suspected of coming into contact with the infected person have undergone PCR testing.

Murata says it has maintained COVID prevention measures. The canteen at the Fukui factory has employed partitions and staggered seating, and records are kept of where employees sit. On the production floor, employees are required to wear masks and maintain social distancing.

The cluster comes as the highly infectious delta variant of the coronavirus spreads from Tokyo to the rest of the country. In the capital, the pace of infections has been slowing, but in the countryside, it is picking up. The government of Prime Minister Yoshihide Suga recently imposed a full or quasi state of emergency in rural prefectures to contain the outbreak.

"The COVID outbreak has been centered around big, crowded cities. People in the countryside may not have been as vigilant as people in the big cities," said Ko Ichihasi, professor at the Saitama Medical Center, Jichi Medical University, and an infectious disease expert.

He said that while the delta variant is more infectious than previous varieties, countermeasures remain the same. "Wear a mask when you talk, avoid conversations in the canteen, maintain social distance, and keep the workplace well-ventilated," he said.

Additional reporting by Mitsuru Obe in Tokyo

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