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Toshiba considering fab restructuring

03 December 2008 | By Mark Osborne | Editor's Blog

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Supported by growing losses and weakening demand, Toshiba Corp. is considering a major reorganization of its semiconductor operations. No timeline was given, according to a Bloomberg story, citing Masashi Muromachi, Corporate Senior Executive Vice President of Toshiba’s semiconductor business units.

Muromachi was quoted as saying that Toshiba could convert its 125mm and 150mm fabs to 200mm and convert existing 200mm fabs to 300mm in an effort to get better control over costs. Muromachi was also considering outsourcing a large part of the company's test and assembly operations for its LSI chip business.

However, Toshiba has approximately 12 200mm fabs as well as 8 150mm fabs and 13 125mm fabs, dependent upon which market research firm data is used. Such an undertaking as Bloomberg reported would seem highly unlikely.

The most likely course of action would be to close the oldest facilities and consolidate production in 200mm fabs, some which could be converted to that wafer size. It would seem highly unlikely that 200mm fabs would be converted in the short term as this would increase capital spending.

Toshiba is also now operating a 300mm fab for LSI devices it acquired from Sony so there could be room for consolidating 200mm production into fewer fabs and improve the utilization at the ex-Sony fab.

Toshiba didn’t mention its plans for two new 300mm fabs thate were announced some time ago but other news stories have mentioned that Toshiba is also considering pushing these fabs out during the current economic crisis. Ground breaking on these two fabs is expected to happen in 1Q09.

As we have seen with many of the memory manufacturers, closing of 200mm fabs has been a key focus in 2008 implying that Toshiba could well be following the trend. However, we don’t expect much further information from Toshiba until financial year-end in March, 2009.

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