SanDisk Expands Manufacturing Operations To China

SanDisk Corp. (Sunnyvale, CA) has announced a new off-shore manufacturing strategy under which it is expanding its manufacturing operations to mainland China. Production in China started earlier this month at a high volume, state-of-the-art plant operated by Celestica in the city of Changping, about 100 miles northwest of Hong Kong.

SanDisk officials, who are making the announcement at press briefings today in Shanghai and tomorrow in Beijing, said that approximately 75% of its unit production of flash memory is expected to be assembled in China. Manufacturing new products, and production of high-end or customer specific products will continue at company headquarters in Sunnyvale, CA.

Ralph Hudson, SanDisk's senior vice president of worldwide operations, said, "We are positioning the company for rapid growth by moving most of our high volume, CompactFlash manufacturing to Asia. About 95% of the raw materials we buy to make our flash memory cards and devices come from Asia and we have a large customer base there."

He added that "SanDisk is partnering in China with Celestica, a three-billion-dollar, multinational, high volume, advanced contract manufacturer. Celestica, which already does manufacturing for numerous major technology companies including Compaq, IBM, Dell and Hewlett-Packard, has a highly automated, world-class manufacturing plant in Changping and SanDisk will benefit from the manufacturing efficiencies and capacity upside of that plant."

The market for flash memory is experiencing rapid growth due to the increasing popularity of consumer electronics products such as digital cameras, MP3 internet music players, handheld computers, smart phones and audio recorders - all products that use SanDisk memory cards to store either digital images, digital audio or data. SanDisk shipped almost two million flash products in 1998, including nearly 1.3 million CompactFlash (CF) cards.