Japanese chip production investment stalls

Top five producers' spend on plant, kit to stay flat through 1999

Japan's five leading semiconductor producers do not intend to expand chip production during 1999, a report in Japanese business newspaper Nihon Keizai Shimbun has claimed. The manufacturers -- NEC, Toshiba, Hitachi, Mitsubishi and Fujitsu -- are currently preparing their spending plans for the coming financial year, due to begin after the end of March. However, investment in semiconductor plant and equipment is almost certain not to exceed last year's spending, and may well be some way below it, the report said. The paper blamed the manufacturers' investment hesitancy not only the massive level of spending in previous years -- most notably the Y890 billion the companies together spent on plant in 1995 -- and the operating losses all five companies' semiconductor divisions are set to report for fiscal 1998. The projected combined spend for 1999 is Y430-460 billion, around half of 1995's figure and the same as 1998's. NEC, Japan's largest semiconductor producer, is set to contribute Y130-150 billion to that total. This year it spent Y150 billion. ®

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