Larry,
Maybe an explanation of MU's action, or lack thereof, today:
5/14/98 - Micron Technology Delays Opening for New Plant in Utah County, Utah
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May 14 (The Salt Lake Tribune/KRTBN)--Micron Technology Inc."s planned summer opening of a microchip-testing operation at its behemoth plant in Utah County has been postponed until late this year or early 1999, a spokeswoman said Wednesday.
The manufacturer based in Boise intends to retain its 200 to 300 employees completing construction of the test facility beneath Traverse Ridge in Lehi, "so that when we need the additional test capacity, we"ll be able to move relatively quickly," said Micron spokeswoman Julie Nash.
The test facility"s opening has been delayed because Micron"s conversion from 16-megabit dynamic random-access memory chips -- called DRAMs -- to 64-megabit DRAMs has been smoother and quicker than Micron anticipated, Nash said. And the company"s test time for its products also "has been significantly reduced."
While Micron is committed to the late 1998/early 1999 timeframe for the test operation, Nash said completion of the rest of the 2.6 million-square-foot facility is dependent on market conditions.
Given the price of DRAMS has dropped dramatically in the last year due to oversupply and a continued slump for chipmakers, delays at Micron"s Lehi plant come as no surprise to Rick Owens, an analyst with D.A. Davidson & Co. in Portland.
"Chip prices have not gotten better. In fact, they continued to get worse this year," Owens said. "It"s tough out there right now for companies like Micron. All the major players in this industry have put most of their capital spending on hold, postponing and mothballing any expansions."
Global chip sales totaled about $10.42 billion in March, down 4.9 percent from the same month in 1997, according to the San Jose-based Semiconductor Industry Association (SIA).
Memory prices historically have experienced cycles in capacity and pricing, although most in the industry say dips in the cycle generally have not lasted longer than one year.
"Memory prices this time have been depressed for 2 1/2 years," said Jeff Weir, a spokesman for SIA. "That"s a long time."
By Cherrill Crosby and Lesley Mitchell
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(c) 1998, The Salt Lake Tribune. Distributed by Knight Ridder/Tribune Business News. [MU], END!A$3?ST-MICRON |
