TOKYO -- Toshiba Corporation today announced that it has started construction of a 300-millimeter (mm) wafer fab at Yokkaichi Operations, Toshiba's key production base for semiconductor memories. Once the high-productivity facility is complete, its output will be channeled to NAND flash memory, a key non-volatile storage component used in a wide range of digital electronic devices.

Total investment in the new Yokkaichi facility in the period through the end of fiscal year 2006 is expected to approach 270-billion yen (approximately US$2.5 billion at the current exchange rate). Toshiba will fund construction of the building, and FlashVision Japan, the joint venture between Toshiba and its NAND flash strategic partner—SanDisk Corporation of the U.S.A. (NASDAQ: SNDK)—will fund its advanced manufacturing equipment, with each partner providing an equal share of the funds.

The 300-mm facility is expected to come on line in the second half of FY2005 (October 2005-March 2006), with an initial capacity of 10,000 wafers a month. At the full capacity currently planned this will climb to 37,500 wafers a month. Output during each phase of expansion will be equally shared between Toshiba and SanDisk, a provision that will form part of the definitive agreement on the facility (Fab 3) that the companies expect to sign in June 2004. The fab still has space to expand capacity, and further investment could take output to as high as 62,500 wafers a month.

At the time of production start-up, the new facility will employ 90-nanometer (nm) process technology jointly developed by Toshiba and SanDisk. Under current plans, the fab will migrate to the 70nm process in the first half of FY2006 and to the 55 nm process in 2007.

Environmentally conscious design will reduce emissions of carbon dioxide and perfluorocarbons from the new clean room, while the energy consumed in wafer processing will be 30% lower than that in Toshiba's current 200mm wafer clean rooms.

Demand for NAND flash memory is growing fast, on healthy growth in digital consumer devices, including digital still cameras, cell phones with cameras, memory cards and MP3 music players. The versatility of NAND flash continues to find new applications, such as increasingly popular USB-compatible memory devices, and Toshiba expects the market to see 30% annual growth from 2003 to 2005, from 380-billion yen to 680-billion yen.

Toshiba believes that construction of the new clean room and the development of advanced NAND technology with SanDisk will assure the superior competitiveness of FlashVision Japan in NAND flash, and the company's greater responsiveness to the growing demand for NAND flash in an increasingly strong market.

Outline of New 300-wafter Facility at Yokkaichi Operations

• Building Structure: Five-story building
• Site Area: 24,300m²
• Floor Area: 113,000m²
• Area of Clean Room: 34,500m²
• Start of the Construction: April 2004
• Completion of Building: December 2004 (projected)
• Start of Mass Production: Second half of FY2005 (projected)

Outline of Yokkaichi Operations

• Location: 800 Yamanoisshiki-cho, Yokkaichi-shi, Mie Prefecture, Japan
• Established: 1992
• General Manager: Jiro Ooshima
• Employees: Approximately 1,700
• Total Area: Approximately 312,000m²
• Total Building Area: Approximately 180,000m² (excluding new 300mm facility)