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To: PAR who wrote (4941)	5/25/1999 8:55:00 PM
From: DJBEINO	Respond to of 9582

Response varies among Taiwan's DRAM makers to dumping duties A service of Semiconductor Business News, CMP Media Inc. Story posted 4 p.m. EST/1 p.m., PST, 5/25/99 By Sandy Chen HSINCHU, Taiwan -- Response among Taiwanese DRAM makers to the news of the U.S. Department of Commerce's preliminary DRAM dumping duties has varied greatly among the Island's local merchants. Some have said the duties will have little or no impact on their business, while others plan to fight the penalties. Still others still are raising the white flag and beating a hasty retreat from the chaotic DRAM market. In response to dumping charges filed last year, the DOC yesterday released its preliminary verdict on the DRAM dumping case by assessing duties ranging from 4.96% to 30.89% on 12 Taiwanese and 1 U.S. memory supplier (see May 24 story). The four Taiwanese memory makers cited by the DOC were Mosel-Vitelic (30.89%); Vanguard International Semiconductor Co. (10.36%); Nan Ya Technology Corp. (9.03%), and Ertron (4.96%). All other Taiwanese DRAM suppliers, including foundries for Japanese memory firms, were assessed dumping duties of 16.65%. This includes the Hsinchu-based companies Acer Semiconductor Manufacturing Co. and Taiwan Semiconductor Manufacturing Co. (TSMC), which make DRAMs for Fujitsu; Powerchip Semiconductor Corp. and Winbond Electronics Co. which produce devices for Mitsubishi and Toshiba; Macronix International Co. Ltd., which makes memory chips for Matsushita; United Microelectronics Corp. (UMC); and two memory design houses, Taiwan Memory Technology Inc. and G-Link Technology Corp. The U.S. fabless memory-design house, Alliance Semiconductor Corp. was also assessed antidumping duties of 16.65%. San Jose-based Alliance uses UMC as its foundry. Spokesmen for both TSMC and Macronix said that the duties will have little impact on their companies because their memory production is so limited. "Our DRAM capacity is lower than 5%," said Y.C. Huang, vice president of TSMC. Y. L. Lin, assistant managing director of Macronix, said that the verdict is "meaningless" to the company because it does not sell any chips to the U.S. market. "Our DRAMs only were sold to Matsushita--about 1,000 to 2,000 wafers per month." But not all manufacturers are as cavalier about the duties. Acer Semiconductor has said it plans to reduce its mainstream memory capacity from 85% to 25% next year and shift a greater percentage of its focus to foundry work. Local sources say Acer may be the first company to drop out of the fierce market. "The DRAM business is too risky," said Teddy Lu, executive vice president of the chip maker. Last year, Acer Semiconductor lost $150 million. However, local DRAM merchants Mosel-Vitelic, Nan Ya and Vanguard--which each ship almost 20% of their production to the U.S. market--have a great deal at stake in the embattled market, and are not giving up without a fight. Mosel, which was hardest hit with a 30.89% duty, said it will supply the Department of Commerce with more data in an effort to get the duty rate lowered. In the meantime, Mosel plans to work with its alliance partners to divert shipments of its chips to locations outside the United States, according to William Chen, executive vice president of Mosel. Nan Ya and Vanguard both said their customers had anticipated the penalty duty issues and made plans for it. "We will never give up the U.S. market." said Charles Kau, executive vice president of Nan Ya. Though analysts have said that the duties will make it nearly impossible for the Taiwanese DRAM makers to compete in the U.S. market, the increasing demand for chips to supply operations outside the United States just may be the saving grace of the Taiwanese chip makers. Spokesmen for IBMCorp. and Compaq Computer Corp. have reported that the PC giants plan to begin sourcing DRAMs from Taiwan in the second half of this year to supply their international manufacturing facilities.