EMCORE makes progress on overcoming Thailand flooding

EMCORE Corp. (NASDAQ:EMKR) said yesterday that it expects to be fully recovered from the flooding of its contract manufacturer’s facility in Chokchai, Thailand by October 2012 – one year after the flood occurred.

Jul 19th, 2012

EMCORE Corp. (NASDAQ:EMKR) said yesterday that it expects to be fully recovered from the flooding of its contract manufacturer’s facility in Chokchai, Thailand by October 2012 – one year after the flood occurred.

An unusually active monsoon season last fall caused severe flooding in Thailand. In addition to significant loss of life and property, the flooding left more than three feet of water in Fabrinet’s Chokchai plant (see “Thai rains knock out Fabrinet, worry optical communications customers”). Fabrinet operated production lines for several optical communications companies at the facility; the resulting loss of production capacity caused part shortages for some optical systems vendors and depressed the optical components and subsystems market.

Fabrinet produced several products for EMCORE at Chokchai, including some for the telecom and cable television (CATV) markets. EMCORE moved quickly to replace the lost capacity, rebuilding the lost production lines at other locations (including an alternative facility at Fabrinet), as well as its own manufacturing facilities in China and the United States.

EMCORE says now that these rebuilding plans remain on schedule. For example, integrable tunable laser assembly (ITLA) production for coherent 40- and 100-Gbps applications has been running since March with Fabrinet, ahead of schedule. The company has finished production line qualification, and most customers successfully completed full-line audits and started taking shipments in April. The ITLA line is now operating at pre-flood capacity run-rates, the company reports.

Meanwhile, the CATV laser module and transmitter production lines at EMCORE's facility in China reached pre-flood capacity levels in mid-July, the company says. That leaves the tunable XFP (TXFP) transceiver line at Fabrinet, which EMCORE says should reach volume production levels by this October. Until then TXFP manufacturing continues in the U.S. at EMCORE's Newark, CA, facility.

"We are very appreciative of our customers' understanding, cooperation, and support during the rebuild of impacted production lines the past 9 months," said Jaime Reloj, vice president of business development for EMCORE. "Our customers have demonstrated their commitment by closely working with us to accelerate product qualification from the new lines. Based on the strong demand for certain product lines, such as ITLA, EMCORE is increasing production capacity to exceed pre-flood levels to support orders for 40- and 100-Gbps coherent applications."

For more information on optical subsystems and suppliers, visit the Lightwave Buyer's Guide.

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