Response to Sluggish Demand
Samsung Electronics Co. has suggested that it may partially adjust its output of memory semiconductors such as DRAM and NAND flash. Previously, the company made it clear that it would not artificially cut production. The company is expected to convert some memory production lines to non-memory ones, including sensors.
SK Hynix Inc. also announced similar plans to retool part of its memory lines for production of non-memory image sensors last month.
An industry insider said, “Samsung Electronics announced during its Q2 earnings conference call on July 31 that there would be no artificial cut in production, but I understand that the firm has already come up with measures to respond to changing conditions, including market demand.”
Samsung Electronics already responded to a drop in market demand by converting part of NAND flash production lines to research and development (R&D) facilities in the first half of this year. It has also left the possibility for additional measures open depending on the situation.
It means that there will be no artificial production cut in the form of reducing the amount of wafer input, but there is a possibility to turn some of the memory production lines into non-memory image sensor lines through a production process conversion.
Samsung Electronics announced that it has not fixed plans to turn Line 13 on the Hwaseong Campus into an image sensor production line. However, it said, “We are planning to optimize the efficiency of our semiconductor lines as a whole. We will consider the medium- and long-term outlook for the DRAM market, the outlook for demand of image sensors and the efficiency of production lines.”
In addition, Samsung Electronics said it would complete Pyeongtaek Line 2 by next year as scheduled, but it would flexibly operate it depending on demand. Industry watchers expected earlier that the company would mass produce 1Z nano DRAMs at the plant, but it could use the line in other ways depending on market conditions.