Some players with weak cost structures may follow after Hynix's cutback, says DRAMeXchange

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2008-09-22 15:08

Taiwan--(뉴스와이어)--After Elpida/PSC's 10-15% output cut, Hynix Semiconductor Inc. (Hynix) announced operation stoppage of total production output will come from 200mm FABs. Amid the reduction of Elpida/PSC, together with Hynix, global DRAM output is estimated to be reduced by 5-6 %., according to DRAMeXchange.

DRAM spot price has dropped by an approximate of 20% since the end of the Beijing Olympics. The present pricing is still lower than makers' variable cost of US$1.30-1.50.

To ensure an earlier recovery, some second-tier suppliers are suggested to cut output to ensure stability in market. DRAMeXchange expects some players with weak cost structures that may follow the production cutback trend, thus, DRAM output is estimated to be reduced by 6-8 % in total. Some second-tier DRAM makers with weak cost structures are also recommended to scale back production in helping the industry to weather the worst slowdown in history.

DRAM makers can no longer rely on the bit growth in projecting their output.

The current DRAM market slowdown, which has already lasted for two years, has caused the cash levels of DRAM makers to drop substantially. Businesses have been difficult to run, and investors and banks are not pleased. Progress in the investments of more advanced technology has come to a halt, as well. This will undoubtedly impact the entire industry and consumers. Analysts have indicated that coupled with the current macroeconomic woes, substantial changes in the PC/NB market has been seen. DRAM makers can no longer rely on the bit growth in projecting their output. Instead, they must focus on the sales revenue and return on assets as their primary targets.

At present, the DRAM industry is not about winning or losing of companies unless the DRAM output is adjusted. Instead, it will be a loss encompassing everyone, says DRAMeXchange.

About DRAMeXchange

DRAMeXchange is a global leading provider of market intelligence, in-depth analysis reports and consultant services on major electronics components. Our company consists of 3 major research divisions---DRAMeXchange, WitsView and LEDinside which cover the DRAM, NAND Flash, PC, display and LED research sectors.

In the year 2000, the company started to deliver market intelligence services under the name of DRAMeXchange technology. This includes current business environment, real-time spot trading prices, market trends, capital spending and wafer capacity trends, the impact of DRAM/flash memory products on the market, and other relevant PC industry information. You can learn more about DRAMeXchange by visiting www.dramexchange.com.

In 2006, DRAMeXchange acquired LCD research institute WitsView to provide insights on the display industry.

In 2007, LEDinside, a subsidiary of DRAMeXchange was launched and has become one of the most popular and distinguished online news and information provider for the LED market.

웹사이트: http://www.DRAMeXchange.com