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Technology Stocks : VALENCE TECHNOLOGY (VLNC)

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To: John Curtis who wrote (4824)11/11/1998 1:18:00 PM
From: Larry Brew  Read Replies (1) of 27311
 
John, << customer testing production line >>
It doesn't work that way, speaking from 27 years with TI, in design, process, product, and process development. Once prototypes are built,
they are placed on life test for reliability. Simultaneously, and
often before life test, proto-type devices are sent to the customer for evaluation. Production can not begin until customer approves all samples and life testing passes all parameters. The customer can waive certain life test failures if he believes these failures are
not critical to reliability. As you can see, it would be a difficult
question to answer to someone not in the field.Hence the no comment. If the device is said to be in production prior to completion of all testing, it's actually
in pre-production. This would not occur without a very high degree of confidence in the product. Production puts a lot of capital at risk for both parties. Customer will be paying for all production devices that pass production testing, with risk of reliability failures in the field. The manufacturer's risk is yield. If only a few % of devices built pass testing, he has no profit margin.
Larry
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