By Kim Yoo-chul
Staff Reporter
After Samsung Electronics revised upward its shipment growth forecast for both computer and flash memory chips to maintain the current leadership in semiconductors, Samsung’s overseas rivals are making efforts to secure ``right measures’’ for survival.
``Amid the gloomy situation in the global chip market, our company plans to maintain the dominance by killing its rivals with cash,’’ a high ranking official of Samsung Electronics told The Korea Times Sunday.
``As far as I know, Samsung will invest some 10 trillion won solely for the semiconductor business in 2008,’’ he added. The official declined to be identified, saying he is not authorized to talk with media.
The remarks came a few days after Chu Woo-sik, head of Samsung Electronics’ investor relations team, told reporters that the company expects DRAM ``bit growth’’ ― a rate of shipment growth based on bits ― of 100 percent, while it expects NAND flash memory chip bit growth of 130 percent in 2008.
``We will invest more than 7 trillion won in semiconductors,’’ he said last week.
Chu’s somewhat ``ambitious’’ view is against the industry’s estimated average bit growth of 55 percent for DRAM chips and 135 percent for NAND chips.
Amid falling global chip prices, Samsung was the only maker to post profit in chip business in the first quarter among its rivals. Its operating profit reached 200 billion won with sales of 4.87 trillion won. The No. 2 Hynix Semiconductor posted an operating loss of 482 billion won, while Japan’s Elpida fell to a 29.2 billion yen quarterly loss. Munich-based Qimonda and most of Taiwanese firms also suffered losses due to ever-declining chip prices.
To offset falling profitability due to the industry’s continuing oversupply, global chipmakers are busy cutting their capital spending on chips unlike Samsung.
Samsung trailer Hynix Semiconductor reaffirmed its earlier plan to slash this year’s investment by 1 trillion won in the second half, while Japanese and Taiwanese makers are seeking to strengthen their overseas partnership for cost-cuts and technology upgrade.
``The consolidation move in the global memory chip industry is heating up and Samsung is the major contributor to accelerate the move,’’ the unnamed Samsung official said.
Last week, Elpida and Qimonda said they would work together to develop a finer 40-nanometer technology and below stack manufacturing (vertical expansion) technologies. If the companies form a joint venture, their combined market share will reach some 27 percent in the global DRAM market.
According to industry estimates, Samsung leads the market with a 28 percent share, followed by Hynix with 21 percent. Qimonda and Elpida is the No. 3 and No. 4 with 12.7 percent and 12.2 percent, respectively.
``We hope to conclude the ongoing talks with ProMOS,’’ Hynix CEO Kim Jong-kap said. The company is discussing the transfer of advanced 54-nanometer chip process technology to the Taipei-based partner in a foundry contract to cut costs.