Chip industry seen cutting investment seen in 2nd quarter
Facility investments in the semiconductor industry are expected to decline in the second quarter in accordance with a drop in the price of DRAM memory chips, according to a report by the Korea Semiconductor Association (KSA).
In a survey of seven chipmakers, including Samsung Electronics and Anam Semiconductor, the association found that their investments for facility expansion and research and development (R&D) will decrease considerably in the second quarter.
The companies' facility expansion budget amounted to 987 billion won, a 28.4 percent drop from the same quarter last year and a 23.6 percent fall from the first quarter of this year.
R&D investment will also be curtailed to 150 billion won, a 5.4 percent drop year-on-year and a mere increase of 1 percent from the first quarter.
While the manufacturing of new products and automation will surge 116.9 percent and 16.9 percent, respectively, year-on-year, they will actually decrease 18.5 percent and 5.8 percent from the first quarter.
The fall in investment is attributed to the weakened profitability in the chip industry as DRAM prices continue to fall, an official said.
"As it is becoming more difficult to obtain investment resources and because the economic outlook is uncertain, companies are downsizing their investment plans," he said.
Meanwhile, the KSA announced earlier that due to the economic slowdown, the semiconductor equipment market would be worth $2.2 billion this year, representing a fall in value of 44.5 percent from last year.
2001.04.23 |
