After Qimonda’s pleas to the State of Saxony for a bail-out, Taiwan’s DRAM manufacturers including ProMos and Powerchip are said to have asked for a government hand-out to save them.
And the government of Taiwan is said to be symnpathetic with some reports saying that the government has agreed to provide loans to memory makers.
Powerchip has asked the government to buy a stake in the joint venture it has with Elpida of Japan called Rexchip.
Promos said that it has directly asked the government for a bail-out ‘for the good of Promos, and for the good of the long-term development of Taiwan’s DRAM industry.’
The Taiwan industry is said to be nursing collective losses of $2.4bn this year. However Taiwan’s Ministry of Economics points out that government strategy is to encourage consolidation in the island’s DRAM industry ‘so that we can cure the illness rather than just the symptoms.
The worldwide DRAM industry is grossly over-supplied with companies over-investing massively to gain market share. That has led to huge price erosion. Total DRAM revenues will fall by one fifth in 2008, according to analysts iSuppli.
Taiwan DRAM maker Inotera recently had a 36% stake taken in it by Micron of the US. Subsequently Inotera’s parent Nan-Ya made a $285m loan to Micron.