Siemens blames IMF-backed Koreans for DRAM closure
More scapegoats than you can shake a fist at
Dr Ulrich Schumacher, president of Siemens Semiconductors has spoken out about the impending closure of the chip maker’s Tyneside plant, blaming the EU, the IMF and the Korean chip manufacturers for the decline in the Dram market. In an article published in Electronics Weekly, Schumacher doesn’t pull his punches when speaking out against those he feels are to blame. "I blame the Koreans, and the Koreans, in my view, are backed by the IMF," he said. Schumacher said Korean chip makers had kept Dram prices artificially low to gain market share and in so doing had reduced the value of the market from $40 billion to $14 billion in the last three years. "Siemens is a responsible company, 150 years old, which finances growth out of earnings, but the Koreans have started a war with debt financing." "The Koreans are still pushing prices down and still investing in capacity to buy market share. Not even the oil producing countries behaved in such an idiotic way,” he continued. "The Korean companies are selling below the variable cost of the product - I don’t know how they can do this - I think it has something to do with the IMF." The embittered Schumacher did not hide his anger when talking about the build up to Siemens’ decision to shut down its Dram plant in the north east with the loss of 1,100 jobs. The Tyneside factory had been losing $150 million a year, its closure followed the demise of Siemens Munich plant with the loss of 450 jobs. "I am sorry that the people in Tyneside are paying the bill. It is awful that we have to close a factory. I hated the decision - it was one of the toughest points in my business life so far," he said. He went on to say that he blamed the EU for not taking action to prevent the Korean chip companies dumping stock on to the European market. "We tried to get the EU to take action against dumping but we were not successful. The EU doesn’t realise what the Koreans are doing to prices. I’m very disappointed by the actions of the EU - they said they’d take quick action if there was evidence of dumping but the EU now says that to take action against the Koreans would be discriminatory - because everyone is dumping." Schumacher said he also blamed the IMF for not stepping in to ensure that loans given to the Korean government to shore up its troubled economy were not used to help Korean chip companies keep Dram prices artificially low.