Qimonda Cuts Production at Dresden Facility

From DailyTech: DRAM manufactures are finding that they are having a doubly hard time in the current global economy. Not only is the demand for DRAM down because of reduced consumer spending, but there is also an oversupply of DRAM on the market forcing prices down.

The reduced global demand along with the global oversupply of DRAM has already forced DRAM maker Qimonda to declare insolvency. Reuters reports that Qimonda is now announcing that it will be cutting DRAM production in order to cut costs. Qimonda is also reportedly going to continue talks with investors beyond March in an attempt to bring new capital into the business and emerge from insolvency.

Reuters quotes Michael Jaffe saying, "Various investors have signaled their interest, but as yet there are no binding offers on the table. As anticipated, it will not be possible to reach a conclusive solution by the end of March."

Qimonda, the world's fourth largest DRAM maker, reportedly has about 3,000 employees at its main European plant in Dresden. Production at the Dresden plant will be ramped down and put into standby mode on March 31. The company reports that if it does not find a financial supporter in time that it could be forced to liquidate its holdings. Reuters reports that if Qimonda didn’t put the Dresden facility into standby mode and cease production at the plant it would have had to cover all wages out of its own coffers.

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