Asia on a foundry-building binge
eb-mag.com
Asia on a foundry-building binge
Taiwan and Malaysia foundry operators are moving aggressively to grab market share when the world IC business bounces back
Asia's chip foundry operators have shown how bullish they are on the industry's turnaround this year with a flurry of foundry announcements in recent weeks. To date, Taiwan foundries are leading the way in capacity expansion announcements, but Malaysia has also gotten into the act.
Four Hsinchu, Taiwan, foundries have announced plans to expand capacity. Worldwide Semiconductor Manufacturing Corp. (WSMC), announced plans to invest $1 billion to build a second fab with 0.18- and 0.15-micron capability. Taiwan Semiconductor Manufacturing Co. (TSMC) plans to invest between $520 million and $750 million in added capacity. United Microelectronics Corp. Group (UMC), aims to invest more than $1 billion in production capacity. And Winbond Semiconductor Corp. also has said it will invest $500 million in a new plant.
Taiwan chip makers and foundries accounted for more than 60% of global investment in fab construction and expansion in 1998, according to World Semiconductor Trade Statistics (see table).
Malaysia's Wafer Technology (Malaysia) Sdn Bhd, a foundry based in Kulim, Kedah state, near Penang, also announced that it will begin offering foundry services by the end of 2000. Initially, Wafer Technology will use "bridge production" from LSI Logic Corp.'s Gresham, OR, fab through an agreement announced with the Milpitas, CA, chip maker in May. The Malaysian company's own fab in the Kulim High Tech Park is expected to be fully operational by year end 2002.
The timing looks right for Asian foundries to boost capacity, according to Joanne Itow, senior analyst with Semico Research Corp., Phoenix. "Total foundry wafer demand will grow in excess of 40% over the next two years," says Itow. According to Semico estimates, by 2008, 30% of all semiconductors are expected to be produced by foundries.
"To meet the demand of 0.25 micron and below, 15 incremental factories with [output of] 30,000 wafers per month have to be on-line by 2002," she says.
The Fabless Semiconductor Association's 1999 Wafer and Packaging Demand survey also points to a turnaround in wafer demand. A survey of 82 fabless chip makers showed an expected 43% growth in wafer requirements this year over 1998. |
