South Asian behemoth Samsung has resumed operations at its six production lines that produce NAND memory chips, located near Seoul, and expects to meet production targets.
On Friday last week, the plant Samsung owns near South Korea’s capital Seoul was hit by a major power outage that produced damages estimated at 40 billion won ($40 million).
A switchboard malfunction has halted six production lines at the K2 section in Giheung Plant of Samsung Electronics around 2:30 PM on August 3, 2007. The affected lines were lines 6, 7, 8, 9, 14, and S. Samsung Electronics completed the normalization procedures, and the six lines at the K2 section of Giheung Plant all resumed full operation on August 4.
"The company was able to resume normal operations quickly...and its third quarter result will speak for itself," said Hwang Chang-gyu, president of Samsung Electronics' semiconductor business.
"We plan to compensate for the production losses," Choi Chang-sik, senior vice president of the company, told reporters at a news conference in Kiheung, without providing specific figures.
The blackout did not affect Samsung’s customers because the chip manufacturer keeps stocks for in advance for several days. However, despite the officials’ optimism, short term price for NAND chips is expected to rise, because it will apparently take weeks before the lines are restored to their normal capacity.
"Some of the wafers that were being processed when the outage hit can be salvaged, and the potential yield from the recovered wafers was at a good level," said Choi Chang-sik.
According to the Wall Street Journal, five of the factories produce memory chips for personal computers and NAND memory chips for digital music players, digital cameras and other devices. The sixth produces logic chips, which handle more advanced tasks for electronic devices. Samsung is the world's leading maker of PC memory and NAND memory chips, but a relatively small producer of logic chips.
Samsung’s most prominent clients are Nokia and Apple, the latter being by far the most important, due to the ubiquitous presence of the iPod and the increasing popularity of the iPhone (both of which use chips manufactured at Giheung). Apple is currently world's largest "consumer" of flash memory modules.
