By Kim Yoo-chul
Staff Reporter
Samsung Electronics, the world's biggest maker of memory chips, will create a new memory chip manufacturing line in the country to meet rising demand for high-end computer chips. It is the first time in three years.
Industry watchers said the decision reflects Samsung's positive views of the global memory chip market. It plans to completely transfer its outdated local manufacturing line into an advanced one.
``Samsung has asked local chip equipment makers to supply necessary components for a smooth transfer process from the outdated 8-inch wafer fab to a 12-inch,'' a Samsung spokesman said Friday. The official said a few billion dollars will be needed for the project.
``The new line will operate from the latter half of next year. But the line will initially be used as a `End Fab,' a specially designated line to boost production efficiency by clearing out any bottlenecks during production,'' the spokesman said.
Samsung stopped the operation of the line dubbed Line 10 in Hwaseong, Gyeonggi Province, due to less demand and profitability of the 8-inch wafer chips.
Samsung currently runs four memory chip lines in Hwaseong ― Line 11, Line 12, Line 13 and Line 15. The 11, 13, 15 lines are DRAM-designated lines, while the company is producing NAND flash memory chips from Line 12.
The transferred Line 10 is set to produce 100,000 sheets of 12-inch wafer chips from early 2012, according to Samsung officials.
In February this year, Kwon Oh-hyun, the head of Samsung Electronics' chip business told The Korea Times that his unit will complete the transformation process toward a 12-inch wafer fabrication line from the less-advanced 8-inch wafer facility in its 10th line in Hwaseong by the end of this year.
``The transformation means that Samsung sees a brighter outlook in the global memory chip market over the next few years. Samsung's decision to use the 10th line as an End Fab is strategic as it seems too early for a complete rebound in the global memory chip market. But the company will produce DRAM chips from it after 2012,'' a top-ranking industry official said.
Along with the 11th DRAM line, the 10th line also has the capacity to produce 100,000 sheets of 12-inch wafers.
Industry leaders such as Samsung Electronics and Hynix Semiconductor have been accelerating efforts toward the migration from the outdated chips to the advanced 12-inch chips as their projects for aggressive scaling and array structures will ensure their leadership in the global memory chip market.
Memory chips are the key component used in most electronics devices.
Samsung Electronics plans to shut down an outdated 8-inch (200 millimeters) fabrication line in Austin, Texas, in October as scheduled. Some $500 million will be need for the remodeling process.
Samsung is moving to convert the 8-inch DRAM line to a 12-inch (300 millimeters) NAND flash fabrication line to produce more NAND flash memory chips from the latter half of next year.
The recent announcement came amid the rising demand for memory chips and stabilizing chip prices thanks to the results of massive output cuts by followers and eased woes over the global economies.
Foreign and local brokerages said the third quarter for Samsung will be even better from the previous quarter due to a strong contribution from Samsung's chip business.