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Toshiba to build fourth chip factory

Toshiba to build fourth chip factory

Toshiba Corp., the world's second- largest maker of chips that store photos and other data, will spend 300 billion yen (US$2.6 billion) on a factory to challenge Samsung Electronics Co., No. 1 in the fastest growing chip market.
The company will use the money this fiscal year and next to build a fourth flash memory plant in Yokkaichi, central Japan, the Tokyo-based company said yesterday in a statement. The facility will begin production in October 2007 and raise its monthly output to 67,500 silicon wafers by a year later.
Toshiba yesterday said it expects to double overall production of NAND flash by the year starting April 2008 to counter falling prices, meet growing demand and narrow the gap with Samsung, the world's biggest maker of NAND flash chips. The company in May said it will spend 1.02 trillion yen on its semiconductor unit by March 2009, betting demand for digital cameras and devices such as Apple Computer Inc.'s Ipod will keep stoking flash sales.
"Our clean room operates 24 hours a day, so it's a local tradition to greet each other with, 'Good morning,' regardless of the time of day," Shozo Saito, vice president of the company's chip unit, said at a press conference at Yokkaichi to announce construction of the fourth factory.
Running Overtime
Toshiba's round-the-clock shifts come as its share of the global NAND market rose to 25 percent in the three months ended March 31 from 19 percent in the previous quarter, according to market researcher ISuppli Corp. Suwon, South Korea-based Samsung had a 49 percent share, down from 51 percent.
Samsung last month said its NAND production in the latest quarter was lower than it had anticipated because of manufacturing delays for its newest product, an 8-gigabit, multilevel cell chip. That prompted the company to cut its NAND production growth forecast for this year by 10 percentage points to 170 percent.
Global sales of NAND flash memory will probably grow 31 percent to US$13.8 billion this year, faster than any major segment of the US$227 billion chip industry, according to estimates in May from World Semiconductor Trade Statistics, the biggest chip industry group.
Toshiba is building the new factory for more than taking market share from Samsung. It also needs more capacity to meet demand. The company last month said it expects to meet 70 percent of orders for the chips in the quarter to Dec. 31, compared with 90 percent in the quarter just ended and 95 percent in the previous three months.
The company and Milpitas, California-based SanDisk Corp. will share the Yokkaichi factory's production equally.
Flash Partners Ltd. is Toshiba's venture with SanDisk to make NAND flash memory chips in Yokkaichi, central Japan. Toshiba owns 51 percent of the venture, with the rest held by SanDisk.
SanDisk earlier this week said it will raise its investment in the Yokkaichi by US$350 million to US$2.3 billion to match Toshiba's planned spending.
SanDisk is the world's largest maker of memory cards used in consumer electronics.


Updated : 2021-10-27 11:36 GMT+08:00