In a clear indication that the computer market has gone decidedly soft, Japan’s major semiconductor manufacturers are planning a 10% to 15% reduction in their production of 1M-bit dynamic random access memory chips for the first quarter of 1990 in response to weakening market conditions, believed to be due primarily to the falling demand for personal computers in the US market (CI No 1,335). NEC said that it will reduce production to 4m from 5m per month, citing a slump in the price for 1Ms in the US to $9.70 now from around $24 last summer. Even in Japan, where the computer market is generally seen to be more healthy than that in the US, the value is said to have fallen to around 1,500 yen from 2,000 yen. Oki Electric Industry is planning to reduce production to below 3m a month from the present 3.5m, and Mitsubishi Electric’s monthly production has fallen to between 4m and 4.5m from roughly 5m chips. Toshiba Corp, stressing that it would respond flexibly to changes in semiconductor market conditions, said that production for the first quarter of 1990 would fall below 8m chips a month from the current 9m level. However, it expects production to pick up again in the second quarter when the market is expected to recover and the introduction of new models is expected to boost demand. Mitsubishi Electric suggested the recovery would occur later, possibly not till after summer.
