SAN JOSE -- DRAM joint venture Elpida Memory Inc. of Japan has been in business for just six months, but the company has set lofty goals. During a presentation here today, the joint venture between Hitachi Ltd. and NEC Corp. said it aims to nearly double its market share and take 20% of the world's DRAM sales by 2003.
Elpida officials also indicated that the company's ambitious plans for a 300-mm wafer fab were still on track despite the current downturn that's hammering memory and IC manufacturers worldwide.
The company's initial 300-mm fab--a 0.13-micron frontend facility, located in Hiroshima--is scheduled to move into pilot production by year's end, with the first silicon expected to be rolling out of the plant in April 2002.
But like most DRAM merchants, Elpida's prospects look dim--at least in the near term.
"The DRAM market is alive and well, but we're in a tough spot right now," said Mike Despotes, president and chief executive of Elpida's U.S. subsidiary, Elpida Memory (USA) Inc., in Santa Clara, Calif.
"We're not only seeing a dramatic decline in terms of ASPs average selling prices but also a decline in demand," Despotes said, during a keynote speech at the Platform Conference in San Jose today.
Since the start of 2001, Elpida has significantly lowered its original sales targets due to the severe DRAM slump, Despotes said in an interview after his keynote speech. The company did not give a projection for its worldwide sales in 2001, however.
In the U.S. market alone, Elpida projects its sales will be around $400 million in 2001. In the first six month of 2001, Elpida's U.S. sales were around $185-to-$195 million.
In any event, it's clear where the overall DRAM market is heading. In total, the worldwide DRAM market is expected to decline from $29 billion in 2000, to $14 billion in 2001, according to Semico Research Inc.
Despotes predicted that the worldwide DRAM market could range anywhere between $11 billion to $18 billion in 2001.
"I don't have a predication," he said. "I don't know if the recovery will come sooner or later."
The Elpida executive was a little more upbeat for 2002--and beyond. "We expect a slow recovery in 2002," he said. "We believe we have a bright future."
Elpida itself was originally announced back in late 1999, when Japan's Hitachi and NEC decided to combine their DRAM operations.
Elpida has officially been in business for only six months, but its goals are ambitious: it hopes to grab 20% of the worldwide DRAM market by 2003.
"We've had a goal to have 20% market share by 2003," Despotes said. "We're about half that right now."
The company faces some stiff competition from other DRAM players, such as Hynix, Micron, Samsung, Toshiba, and others.
But a key to the company's success is capacity and product offerings. At present, it has access to two 200-mm fabs--both of which are running 0.18- to 0.15-micron process technologies. Elpida has access to these fabs in the form of foundry relationships with Hitachi and NEC.
One 200-mm fab, owned by Hitachi, is located in Singapore. The other 200-mm plant, part of NEC, is based in Hiroshima.
But a key to Elpida's long-term growth is a previously announced 300-mm fab. Located in Hiroshima, the plant will be owned and operated exclusively by Elpida.
Initially, the plant will produce 256-megabit products based on SDRAM and double-data-rate (DDR) SDRAM technologies, Despotes told SBN after his speech.
At present, the company sells 64-, 128-, and 256-Mbit DRAMs. It sells products based on three main architectures: SDRAMs, double-data-rate SDRAMs, and Rambus Inc.'s RDRAMs.