Hitachi trims chip output at 3 plants
TOKYO, July 19 (Reuters) - Hitachi Ltd, Japan's biggest electronics manufacturer, will extend annual summer chip plant shutdowns by several days this year, underscoring a global slowdown in demand for semiconductors, domestic media said on Thursday.
Hitachi announced it would suspend production of semiconductors at its three main plants in Japan for five to 14 days, far longer than last summer, Jiji news agency said.
The decision by Hitachi, which had already announced plans to cut spending on semiconductor plant and equipment by 36.4 percent to 140 billion yen ($1.11 billion) this business year, follows cutbacks announced last month by Japan's biggest chipmaker, Toshiba Corp and by Mitsubishi Electric Corp .
Hitachi's plant for microprocessors for integrated circuit (IC) cards in Ryuo in Yamanashi Prefecture, will close for 14 days in August, compared with two days last summer, Jiji said.
The company will stop production for 13-14 days at its Kofu and Takasaki plants, which chiefly manufacture semiconductor devices for cellular phones bound for Europe.
Its plant in Gunma Prefecture, which makes ICs for mobile communication devices, will close for 13 days, and the Naka plant in Ibaraki Prefecture, which produces flash memory chips, will shut for five days, Jiji said.
Toshiba has decided to close its chip plants for up to 19 days and Mitsubishi Electric for up to 10 days.
NEC Corp has already said it plans to halt operations at a chip plant for up to 10 days and Fujitsu Ltd. has said it will stop some production lines at its joint venture with major U.S. chipmaker Advanced Micro Devices Inc. for up to four weeks.
Analysts have widely expected Japan's chipmaking conglomerates to curb their production and spending plans for the business year to next March in response to a protracted market downturn.
A Hitachi official said last week the company would cut its monthly production rate for chips used in IC smart cards by 40 percent from targets set at the beginning of the business year.
Hitachi had originally planned to produce 22 million of the
chips in 2001/02.
Hitachi and Fujitsu, like other chipmakers, had been ramping up production of chips for the fast-growing cellphone market when demand suddenly ran out of steam late last year.
Forecasts early in the year had called for growth of 20 percent or more in global handset sales in 2001, compared with last year's 412 million units.
Many analysts and industry executives now expect sales this year to be flat or lower compared with the year before.
While Hitachi's share closed 0.3 percent higher on Thursday, Japan's big other four chipmakers saw their shares move lower for a third consecutive session as the prospects for a global chip market recovery remained unclear.
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