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.