Japan chipmakers put operations on hold

October 3, 2001 – Tokyo, Japan – Fujitsu and NEC, two of Japan’s five chipmaking companies said they are temporarily idling a number of semiconductor plants in Japan as they confront a record chip market downturn.

Several of Japan’s chipmakers are operating their plants at 70% or less of capacity as they adjust output to this year’s steep slump in the semiconductor sector, with the outlook made even more uncertain by last month’s terrorist attacks on the US.

Fujitsu plans to shut operations at its three major microchipmaking facilities in Japan for five days this month and will idle about 5,000 workers.

NEC said a wafer processing line at its Kumamoto plant, on Japan’s southern island of Kyushu, was shut last Friday and would remain idle until Wednesday, and three chip assembly plants would be closed four days this week.

NEC and Hitachi have announced plans to trim wafer processing capacity this year in response to the slump and delayed the start of production at their DRAM chip joint venture by about six months until the fall of next year.

All of Japan’s five chipmakers have announced harsh profit warnings and restructuring measures during the past few months, and four – Hitachi, Toshiba, NEC and Fujitsu – expect hefty consolidated net losses for the business year to next March.

Fujitsu said it would pay 90% of the base salaries of the affected workers during the shutdown.


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