Weak demand, strong yen forces Toshiba to slash chip output

Toshiba is shutting down chipmaking facilities in Japan and cut output elsewhere as demand slumps.

The chip plants for the chop are for discrete chips. Three of the semiconductor factories are due to be slashed at the start of April 2012.

Toshiba is on the back foot, like many other Japanese companies, because of the strength in the yen – so it needs to cut costs, reports Reuters. Toshiba will cut discrete chip output until January, it says. 

You’d think a strong yen would have a country leaping for joy, but actually it cuts the value of overseas money sent back to its shores. 

An analyst told Reuters that Toshiba’s decision isn’t exactly a surprise. The JP Morgan analyst said it’s down to weak demand, as well as domestic customers like electronics manufacturers also cutting their outputs. 

Meanwhile, Bloomberg claims Toshiba will also shuffle about 1,700 workers at the end of September 2012. 1,200 of them will go to group companies and the remaining 500 will be told to advance their careers elsewhere, as one factory halves its output of 150mm wafers.