Word: chips
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...manufacturers claim they could compete head to head with Japanese rivals if the foreigners stopped selling below cost. The U.S. chipmakers are somewhat optimistic about the new trade pact, under which the Department of Commerce is setting so-called fair market values for each Japanese company's chip exports to the U.S. To arrive at the fair market value, which is the minimum price at which the manufacturer is allowed to sell the semiconductor, the department tallies up an individual Japanese ( chipmaker's costs in making each product and adds a profit of 8%. The Government's first fair market...
...chipmakers compete overseas, since it requires the Japanese government to prevent its chipmakers from selling semiconductors below cost in all other countries as well -- though that provision may be difficult to enforce. Perhaps more important, the Japanese government has agreed to help the U.S. and other countries boost their chip sales in Japan, which currently total about $750 million, by as much as $2 billion within five years. Says Thomas Kurlak, who follows the industry for Merrill Lynch: "It has stopped the Japanese ability to steamroll...
Many buyers of chips, however, complain that the Government is protecting one high-tech industry by raising costs for many others. The protests have even come from the European Community, which believes its computer makers could be hurt by rising semiconductor costs. At Silicon Graphics in Mountain View, Calif., the cost of producing a system containing 144 one-megabit memory chips has nearly doubled because the semiconductors have increased in price from $22 to $107. Says Jerry Sugar, president of Classic Technology, a computer-systems maker in San Jose: "I called Washington to protest. Higher chip prices are going...
...least one company, Texas Instruments, has stubbornly refused to give up the race with the Japanese to make ever more densely packed memory chips. Its experimental, 4 million-bit chip contains components smaller than one micron, or .000039 of an inch. Now that the company has created a superchip, the tougher task will be to manufacture them by the millions before the wily Japanese can catch...
...this last question that most troubles critics in Congress who doubt that an effective defense against missiles can ever be built. In their view the program's value is precisely to serve as a bargaining chip. But Reagan's reluctance to use it is likely to intensify pressure in Congress to cut appropriations for SDI research even further below Administration requests. (The $3.5 billion appropriation for fiscal 1987, which began Oct. 1, is only about two-thirds of what the President had requested.) That movement will be all the greater if the Democrats win control of the Senate next month...