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Tech Industry

Japanese scale back chip production

Japanese memory chip manufacturers continue to reduce both investment and production against a backdrop of falling prices.

Japanese memory chip manufacturers continue to reduce both investment and production against a backdrop of falling memory chip prices.

NEC plans to cut monthly production of its 16MB dynamic RAM (DRAM) chips by about 30 percent from an earlier estimate of 12 million to 13 million chips at the end of this year, Japan's Kyodo News Service reported today.

This follows similar moves in July by NEC, Hitachi, and Samsung Electronics. These companies cut production of 4MB DRAM and 16MB DRAM chips due to a drop in U.S. demand and lower prices.

Some observers believe demand may start rising by year's end, a peak sales season, but a major increase is unlikely because of large inventories.