Japanese electronics maker Toshiba said it will cut production of its flash memory chips, used to store data in mobile gadgets, by around 30% to adjust excess inventory resulted due to oversupply and sliding prices.
Toshiba is planning to adjust production of NAND flash memory chips at its Yokkaichi Operation plant in Mie Prefecture, Japan.
The company said the move is due to an oversupply of NAND flash memory in the retail market, for application in USB memories and memory cards, which has resulted in continual price declines since the beginning of this year.
Toshiba said it has responded by adjusting shipments to the retail market since June and from today will reduce the operating rate at the plant in order to adjust output.
The company believes this move will help to reduce inventory in the market and improve the overall balance between supply and demand.
High growth rates are forecast for PCs and Smartphones, the drivers of global market demand of NAND flash memory, and the supply and demand balance is expected to improve in the current quarter, from July to September, says Toshiba.
Along with this, Toshiba will implement a timely production adjustment to encourage early restoration of the balance in supply and demand and improve the overall market conditions ahead of the anticipated rise in demand.
Toshiba plans to continue to closely monitor the NAND market and re-examine production at Yokkaichi as necessary.
Toshiba, the world’s second largest maker of NAND flash memory chips after Samsung Electronics, revealed plans in April to set up its fifth NAND chip plant in Japan by 2013.
