July 10–Tokyo, Japan– Recovering semiconductor demand has allowed Hitachi Ltd. to keep a chip production line and an assembly and inspection subsidiary that were both slated to close.

The company, which has been limiting capital investment in the chip business, had planned to close one of its four production lines by this spring at the Chitose, Hokkaido plant of subsidiary Hitachi Hokkai Semiconductor Ltd.

Hitachi also called off the planned takeover of its assembly and inspection arm in Yamagata Prefecture by Hitachi Yonezawa Electronics Co., another subsidiary, according to the chipmaker.

Last October, Hitachi announced a set of restructuring plans, including staff cuts and disposal of excess facilities. While most of the measures have been carried out, some were changed to account for stronger-than-expected demand for microcomputers used for home electronics appliances.

While Hitachi maintains that it made $1.8 billion in capital investments in chip operations in FY00, it plans to trim the amount to $203 million in the current fiscal year.