Oki Electric Industry Co, the world's biggest maker of low-
capacity memory chips, said it plans to double outsourcing for semiconductor production during the second half of this fiscal year to meet higher demand for its chips, Nikkei English News reported.
Oki currently outsources about 5,000 to 6,000 200mm wa-fers a month to chipmakers in Taiwan and China, including United Microelectronics Corp (UMC, 聯電) and Grace Semiconductor Manufacturing Corp (中芯國際集成電路), the newspaper report said, without saying where it obtained the information.
This will be increased to about 10,000 wafers a month, the report said.
The semiconductors Oki produces will be used in mobile phones, video-game machines and electronic dictionaries, the Nikkei said.
Tokyo-based Oki began outsourcing some production of chips for communications equip-ment and consumer electronics to UMC, the second-largest supplier of made-to-order chips in the world, in late 2002.
Farming out production saves Oki money, which the Japanese chipmaker would otherwise spend on its own plants.
Oki said it will design chips requiring advanced production technology, which UMC has, while it keeps older factories that don't require high spending to maintain.
Since demand for mobile phones, personal computers and other electronic products is expanding in China, Oki said last December that it had asked Grace Semiconductor to supply chips that will be used in Oki's mobile communications products sold in China.
"Oki will expand its system-on-chip [SoC] product offerings from communications to the personal and mobile markets," Oki chairman Katsumasa Shinozuka said in a statement at the time.
"This strategy, which will help boost Chinese market development, further underscores Oki's long-term strategy in China," he said.
Oki said it also wanted to expand its order to Grace Semiconductor this year to include flash memory products to be sold to the Chinese automobile market.
Currently, Oki makes about 35,000 200mm wafers in Japan's Miyagi Prefecture but production hasn't been able to meet rising demand, the paper said. On top of the outsourcing, Oki will increase production at its own factories, it said.
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