TOKYO--SanDisk Corp. and Toshiba Corp. today announced plans to consolidate manufacturing for their joint venture in flash memories at Toshiba's wafer fab in Yokkaichi, Japan. The plan was set in motion after Toshiba agreed to sell its Dominion Semiconductor facility in Virginia to Micron Technology Inc. (see today's story).
Toshiba has been manufacturing NAND-based flash memories for its joint venture with SanDisk at both the Dominion plant in Manassas, Va., and its fab in Yokkaichi. Toshiba said the consolidation of manufacturing for the FlashVision joint venture will make its product more cost competitive. It also plans to accelerate new process technologies for flash chips.
Under an agreement between the two joint-venture partners, Toshiba will equip an unused portion of its Yokkaichi fab with production tools transferred from the Dominion facility. Toshiba has agreed to take full responsibility for the NAND flash production transition from Dominion to Yokkaichi, which is expected to be completed in 2002
The two companies said they expect to be able to meet 100% of their customers' NAND flash requirements during the transition through increased production at the Yokkaichi plant. The facility is the site of Toshiba's advanced NAND flash development pilot line, and currently all new NAND products first enter volume production at Yokkaichi, according to the company.
Toshiba said the consolidation will streamline the transfer of new technology and accelerate next year's volume transition from 0.16-micron NAND to a new NAND/multi-level cell technology, as well as the 0.13-micron NAND.
"Although we are pleased with Dominion's performance, we feel that the consolidation opportunity with Toshiba at Yokkaichi affords us a unique opportunity to accelerate our access to one of the world's lowest cost sources for our NAND wafers," said Eli Harari, president and CEO of SanDisk in Sunnyvale, Calif. "We believe the combination of the highly cost-efficient Yokkaichi facility and the FlashVision advanced equipment tool-set from Dominion will provide us with materially lower wafer costs over the long-term while preserving our near-term access to wafer supply. We plan to negotiate with our current lenders for the leasing of the FlashVision tool-set that will permit the transfer of these tools by FlashVision to the Yokkaichi facility.
"Assuming that the consolidation proceeds as planned, we do not expect to see any adverse financial impact in 2002, nor do we expect any reduction to our NAND supply relative to the current FlashVision plan at Dominion," he added. "We expect to begin to see a substantial positive impact to our NAND memory cost structure starting in the second half of 2002 and improving further in 2003 and beyond."