Micron delays investment plan for new plant in Hiroshima, Japan by 7 months

According to Japanese media Nikkan Kogyo Shimbun, US memory giant Micron has delayed its investment plan for a new factory in Hiroshima, Japan.

It is understood that Micron's DRAM factory (Fab 15) in Hiroshima, Japan uses the most advanced process technology. Among them, the latest production plant B of the factory was completed and put into use at the beginning of this month, and its clean room area has been expanded by 10% compared with the original. Micron also plans to produce a new generation of DRAM to narrow the gap with Samsung, the leader in the DRAM industry.

Judging from the global DRAM market share in the first quarter of 2019, among the world's top three manufacturers, Samsung's DRAM market share was 42.7%, SK Hynix ranked second with 29.9%, and Micron ranked third with 23%.

The report pointed out that Micron's factory in Hiroshima, Japan was actually acquired after it bought Elpida in 2012. It was originally planned to start production of the next-generation DRAM using the 1z nanometer process at the factory in mid-2019.

Micron has said that it will invest billions of dollars in the Hiroshima plant in the next few years to develop the production of a new generation of DRAM memory. However, it is reported that the expansion of the F building, which has already started construction, was originally expected to be completed in July 2020, but has now been delayed to February 2021, a full 7 months.

Previously, the market research institute TrendForce Semiconductor Research Center (DRAMeXchange) pointed out that due to the impact of trade frictions, individual sales bans may hinder the overall shipments of global smartphones and server products, and will impact the peak season demand and price bottoming time of DRAM products in the second half of the year. Therefore, the outlook for DRAM prices in the third quarter was revised down, and the decline was expanded from the original estimated 10% to 10~15%.

TrendForce also stated that the escalation of global trade frictions may lead to a sudden freeze in demand and increased uncertainty in the second half of this year, which will slow down capital expenditures at data centers. It is expected that before the end of this year, DRAM suppliers with poor pressure-bearing capabilities may recognize losses on existing inventory on their books, and their financial statements will officially turn into a loss-making situation.

Therefore, under such market share, Micron has to revise and adjust its previously planned investment plans.