The fab is set to make Elpida's staple product, DRAMs, according to reports that quoted Elpida President Yukio Sakamoto.

The new fab is a signal that Elpida intends to stay in the highly volatile DRAM market and try and gain economies-of-scale advantages over its rivals, Samsung and Micron.

"Expanded market share could lead to improved earnings. [Elpida] has to make the bet," reports quoted Sakamoto as saying.

The 300-mm fab, slated to be in built in Hiroshima in southwestern Japan, would be twice the size and manufacturing capacity of any of the largest current-generation facilities, the reports said. It would be financed by share and bond issues and loans, according to Japanese reports.

Elpida's second 300-mm wafer fab is scheduled to begin operation next year. Along with current capacity, Elpida said intends to increase its presence in the DRAM market comparable to leading manufacturers such as Samsung Electronics and Micron Technology.

Details of the fab plan are to be formally announced on Thursday, Elpida said.

Elpida, based here, is the joint venture company formed in 1999 to combine the DRAM operations of Hitachi Ltd. and NEC Electronics. Elpida took over parent companies' unprofitable DRAM businesses.

Elpida's business showed a profit during the first quarter. Now Elpida is gearing up to increase its presence in the DRAM market by taking advantage of its location close to customers, Japanese digital consumer electronics manufacturers. "The growing digital consumer electronics market is favorable for Elpida's DRAM business. All of those products have DRAMs. Orders are almost surpassing our supply capability," Sakamoto said.

The new fab is expected to produce DRAMs for digital consumer devices.

By: DocMemory
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