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Hitachi on Friday announced the decision to discontinue the manufacturing of semiconductors for information and telecommunication hardware. Hitachi will terminate the manufacture of semiconductor integrated circuits currently performed by the micro device division under the Information & Telecommunication Systems Co. on March 31, 2014.

Going forward, a variety of steps will be taken to bolster the global competitiveness of the Information & Telecommunication Systems business. The division will focus on development, design and quality assurance of chips primarily for Hitachi Group products, including information and telecommunication hardware. Production-related human resources and other management resources will be reallocated throughout the Hitachi Group.

Hitachi first established the device development center in 1975, with the aim of developing semiconductor integrated circuits for information and telecommunication products. In 2004, the center was incorporated under the micro device division as part of organizational reforms. Since then, the center has been engaged in the design, development, manufacture and sale of semiconductor integrated circuits for the Hitachi Group and external customers utilized in information and telecommunication devices, as well as for application in the measurement, medical and industrial equipment fields.

The semiconductor industry has seen an increasingly horizontal division of labor in terms of development, design and manufacturing in recent years. The same holds true for Hitachi, which has pushed ahead with the external outsourcing of production of certain products alongside efforts to curb manufacturing costs and boost production efficiency in a bid to maintain and enhance business competitiveness. It was in this climate that the decision was made to terminate and outsource externally the manufacture of semiconductor integrated circuits presently performed under the micro device division.

The intent of this move is to optimally allocate management resources to bolster the competitiveness of the entire Information & Telecommunication Systems business. Going forward, Hitachi will promote a business specializing in the development, design and quality assurance of LSIs primarily for Hitachi Group products, including information and telecommunication hardwares. In parallel, production-related human resources and other management resources will be optimally allocated throughout the Hitachi Group. Details regarding the reassignment of human resources will be examined in the process of moving forward with this decision.

Tags: Hitachi, Semiconductor

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