Toshiba and SanDisk announced this week that they will be temporarily cutting back the production of NAND flash memory by 30% at their manufacturing facilities in Yokkaichi, Japan. The two companies decided to cut production due to the decreased demand for flash memory caused by the recent recession and slowdown in consumer spending.
SanDisk Corporation (NASDAQ: SNDK) today announced temporary cuts to its Flash wafer production in its joint-venture manufacturing facilities in Yokkaichi, Japan. Production in Fab 3 and Fab 4 will be temporarily halted from December 31 to January 12. Following this shut-down, joint venture production will resume at approximately 70 percent of current capacity. The duration and extent of this reduction in fab output will depend upon market conditions. These steps will result in higher wafer cost due to underutilization of capacity; however, they are expected to better align SanDisk’s captive output in 2009 with the projected demand in the current global economic slowdown.