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Hynix opens new fab amid NAND glut

Posted: 01 Sep 2008     Print Version  Bookmark and Share

Keywords:NAND fab  NAND flash market  NAND downturn  manufacturing facilities 

Amid large losses and a memory downturn, Hynix Semiconductor Inc. has opened a new, 300-mm NAND fab in Korea, with initial production slated for September.

With the announcement, Hynix has become perhaps the wild card in NAND. It is opening the fab amid a NAND glut and vast financial losses.

Samsung, Toshiba and the Intel-Micron duo are also ramping up relatively new NAND fabs, but those vendors are showing some restraint in the current climate. The question is whether Hynix' fab ramp will exacerbate or prolong the current NAND flash-memory downturn.

The NAND flash market has seen a sharp downturn since the beginning of 2008. And iSuppli Corp. has recently cut its 2008 NAND annual flash revenue growth forecast from 9 per cent to virtually zero.

With the exception of market leader Samsung Electronics Co. Ltd., the other NAND suppliers are losing money. Intel, Micron, Hynix and Toshiba are all losing money in NAND, due to a capacity glut and product procurement cutbacks from one of the biggest NAND buyers: Apple Computer Inc.

It's unclear how fast Hynix will ramp its new fab. But clearly, if the company does not exhibit any restraint, it could potentially prolong the NAND downturn. Some believe Hynix will show little or no restraint.

Many do not see a recovery until the second half of 2009. Samsung tends to be the mover and shaker in the market, but Hynix could hold the supply and demand key.

There are other factors as well. ''Flash needs very strong consumer electronics demand between now and December to turn around gross margins and sales for manufacturers,'' said Jim Cantore, president of consulting firm JLC Associates. ''Slowing down the capacity expansion plans would also help a lot.''

In recent times, Hynix has reduced its NAND production in a 200-mm fab in Korea. Japan's Toshiba Corp. has recently closed a 200-mm NAND fab amid a massive 300-mm expansion plan.

But the fab shutdowns have not impacted supply. And now, Hynix, the world's third largest NAND supplier, is now ramping up a new 300-mm fab. Located in Cheongju, Korea, Hynix broke ground on the so-called M11 fab in April of 2007. The fab, which occupies a grand total of 294,637 square meters, is the third plant at that site.

M11 is scheduled to begin production of approximately 40,000 wafers per month starting in September. It will fabricate 16- and 32-gigabit NAND flash parts, based on 40-nm technology.

More specifically, Hynix is making NAND parts at the 48-nm node right now. By completing the third factory, Hynix has a total capacity of 200,000 wafers per month.

The Korean company is also working with a partner. Last month, Numonyx B.V.—the memory spin-off of Intel Corp. and STMicroelectronics Inc.—teamed up with Korea's Hynix in a major push in the NAND flash-memory market.

Under the terms, Numonyx and Hynix have disclosed a new, five-year agreement to expand their joint development programmes in NAND. The companies will co-develop products and processes in the arena, including a yet-to-be-announced 41-nm line-up.

''Hynix plans to develop Cheongju site as the number one NAND flash manufacturing facilities in the world starting from this completion of the 3rd Factory construction. Though recovery of the semiconductor industry has been in delay, we will continuously secure competitiveness and growth engine for sustainable growth with our leading-edge technologies and active strategic alliances,'' said Jong-kap Kim, chairman and CEO of Hynix, in a statement.

- Mark LaPedus
EE Times

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