Elpida CEO Yukio Sakamoto shared his ambitious plans to beat Samsung and become the number-one DRAM supplier within two years:
Elpida aims to be the number-one DRAM supplier in 2010. Combining capacity from Powerchip Semiconductor Corporation (PSC) and Rexchip Electronics, the entire group currently delivers a monthly capacity of 270,000 wafers, and the amount will expand to 300,000 wafers during late 2008. In order to meet its goal of becoming number-one, Rexchip will boost its capacity to 300,000 wafers in 2010, with total capacity from the four fabs of Rexchip, three of PSC and two of Elpida targeted to reach 600,000 wafers.
Already the largest DRAM supplier in the handheld applications segment, Sakamoto said Elpida aims to also take the lead in the commodity DRAM market. Despite some customers having requested price cuts for memory used in handheld applications, he noted that Elpida will not reduce its quotes in order to preserve its market share.
Despite many industry players questioning Elpida's decision to adjust pricing during the DRAM industry trough, Sakamoto indicated that the absence of a reasonable pricing environment will leave the industry with only one or two players. By then the sharp cut in DRAM supply will lead to a rapid price hike, with the price of 1Gb DDR2 likely to shoot from the present US$1.70 to US$10. Such a price surge is not desirable for PC OEMs, he said.
The only way to prevent this scenario is to enact price adjustments. By encouraging a reasonable pricing environment, DRAM makers and PC OEMs will see mutual benefits, Sakamoto commented. If industry players resume a logical pricing mechanism, he anticipates that fellow DRAM makers should break even in the second quarter at the earliest, and pricing for 1Gb DDR2 chips is likely to rebound to US$3.50-4.00 levels by year-end 2008.