Taiwan's dynamic random access memory (DRAM) chip manufacturers are fighting an uphill battle for survival as prices continue to slump, officials at Taiwan Ratings Corp (
Taiwan Ratings associate director Tony Tsai (蔡東松) said several DRAM makers here may encounter liquidity shortfalls in the first half of next year if product prices continue to fall and if DRAM makers are unable to attract fresh finance.
"We expect to see the fate of some cash-strapped DRAM makers unfold between January and June next year if the current situation fails to improve."
Currently, Taiwan has five DRAM makers -- Mosel Vitelic Inc (茂矽電子), Winbond Electronics Corp (華邦電子), Powerchip Semiconductor Corp (力晶半導體), Nanya Technology Corp (南亞科技) and Promos Technologies Inc (茂德科技) -- which all suffered operating losses ranging from NT$1 billion (US$28.95 million) to almost NT$5 billion in the first half of this year.
Tsai said some of these companies would need to pay back corporate bond issues in the first half of next year, further pressuring their cash positions.
The industry weakness has made it more difficult for DRAM makers to secure bank loans or raise funds through overseas issues, he added.
Taiwan's DRAM makers face great difficulty in competing against foreign counterparts because they are much smaller in size, market share and lack research development capabilities, Tsai said.
Each Taiwan DRAM maker's global market share stands below five percent, compared with Samsung's 20 percent and Micron's 16 percent, he noted.
As many companies are mainly concentrated on DRAM production and depend heavily on technology transfers from overseas manufacturers, their technologies and manufacturing abilities would be seriously affected once their overseas partners decide to withdraw from such production, he said.
Oversupply in capacity utilization of DRAM makers is likely to continue and add pressure on companies' cash position and credit quality, unless manufacturers effectively cut back production or certain key suppliers withdraw from the market, Tsai said.
The price trend of DRAM chips, the consolidation of major players in Japan, South Korea and Europe, and PC demand following the introduction of Windows XP operation system and Intel's Pentium 4 processor would be crucial to the credit risks of local DRAM companies in the coming year, according to Taiwan Ratings.
AIR SUPPORT: The Ministry of National Defense thanked the US for the delivery, adding that it was an indicator of the White House’s commitment to the Taiwan Relations Act Deputy Minister of National Defense Po Horng-huei (柏鴻輝) and Representative to the US Alexander Yui on Friday attended a delivery ceremony for the first of Taiwan’s long-awaited 66 F-16C/D Block 70 jets at a Lockheed Martin Corp factory in Greenville, South Carolina. “We are so proud to be the global home of the F-16 and to support Taiwan’s air defense capabilities,” US Representative William Timmons wrote on X, alongside a photograph of Taiwanese and US officials at the event. The F-16C/D Block 70 jets Taiwan ordered have the same capabilities as aircraft that had been upgraded to F-16Vs. The batch of Lockheed Martin
GRIDLOCK: The National Fire Agency’s Special Search and Rescue team is on standby to travel to the countries to help out with the rescue effort A powerful earthquake rocked Myanmar and neighboring Thailand yesterday, killing at least three people in Bangkok and burying dozens when a high-rise building under construction collapsed. Footage shared on social media from Myanmar’s second-largest city showed widespread destruction, raising fears that many were trapped under the rubble or killed. The magnitude 7.7 earthquake, with an epicenter near Mandalay in Myanmar, struck at midday and was followed by a strong magnitude 6.4 aftershock. The extent of death, injury and destruction — especially in Myanmar, which is embroiled in a civil war and where information is tightly controlled at the best of times —
Taiwan was ranked the fourth-safest country in the world with a score of 82.9, trailing only Andorra, the United Arab Emirates and Qatar in Numbeo’s Safety Index by Country report. Taiwan’s score improved by 0.1 points compared with last year’s mid-year report, which had Taiwan fourth with a score of 82.8. However, both scores were lower than in last year’s first review, when Taiwan scored 83.3, and are a long way from when Taiwan was named the second-safest country in the world in 2021, scoring 84.8. Taiwan ranked higher than Singapore in ninth with a score of 77.4 and Japan in 10th with
SECURITY RISK: If there is a conflict between China and Taiwan, ‘there would likely be significant consequences to global economic and security interests,’ it said China remains the top military and cyber threat to the US and continues to make progress on capabilities to seize Taiwan, a report by US intelligence agencies said on Tuesday. The report provides an overview of the “collective insights” of top US intelligence agencies about the security threats to the US posed by foreign nations and criminal organizations. In its Annual Threat Assessment, the agencies divided threats facing the US into two broad categories, “nonstate transnational criminals and terrorists” and “major state actors,” with China, Russia, Iran and North Korea named. Of those countries, “China presents the most comprehensive and robust military threat
RSS