April 27, 2005 – Toshiba Corp. plans to lift monthly production of NAND flash memory chips at its plant in Yokkaichi, Mie Prefecture, to the equivalent of 21,500 300mm wafers by the end of 2005, more than double its initial plans, The Nihon Keizai Shimbun learned Tuesday.

The firm can now meet only 80% of orders for the chips because they are widely used in increasingly popular portable digital music players and digital cameras. In addition to increasing output, the hike will likely lower production costs and enable Toshiba to better compete with such rivals as Samsung Electronics Co.

Toshiba initially planned to increase monthly output at the plant, which began operating in February, to the equivalent of 10,000 300mm wafers in December and to 28,500 in the latter half of fiscal 2006.

A total of 270 billion yen was initially earmarked for investment in the plant from fiscal 2003 to fiscal 2006. But Toshiba now intends to spend the money earmarked for fiscal 2006 this fiscal year to lift the plant’s monthly output capacity.

Toshiba estimates that the global market for the chips will grow from around 700 billion yen in 2004 to 2.1 trillion yen in 2008.

Meanwhile, Fujitsu Ltd. is considering beginning full-scale production at its system chip plant in Kuwana, Mie Prefecture, in fiscal 2006, a year earlier than originally planned, following the higher-than-expected orders received by the firm ahead of the scheduled launch of mass production at the plant in September. It may also be studying whether the plant’s output can be increased from the current plans of 13,000 units/month.

Elpida Memory Inc. intends to start operating its DRAM plant in Hiroshima Prefecture up to two months earlier than the slated December launch of production in order to quickly lower manufacturing costs amid falling sales prices of DRAMs.