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To: maceng2 who wrote (259308)	9/8/2003 1:57:18 PM
From: maceng2	Respond to of 436258

Semiconductor wafer size change stuff.. STMicro Restructure Hits Labor Snag reed-electronics.com Online Staff -- Electronic News, 9/3/2003 Geneva-based chipmaker STMicroelectronics said today that labor talks revolving around a previously announced plan to close its older French fabs have broken down. The company apparently still plans to go ahead and close and consolidate its 150mm French fabs. STMicro announced late in July that it planned to migrate at least half of its U.S. and European 150mm wafer fab production to 200mm fabs or the company's 150mm Singapore fab. The industry trend to convert to 200mm and 300mm wafers, pricing pressures and the competitive nature of 150mm production lines, and the trend among STMicro's customers to shift their own production to Asia, prompted the move, the company said. Labor representatives from the French Central Workers' Committee today walked out of a meeting with STMicro's French subsidiary to discuss the cuts to the company's French manufacturing operations. The plans that STMicro planned to present at the meeting were then sent to each representative by mail this afternoon, the company said. Those plans include: closing of the 150mm wafer fab at Rennes; continuing to make specialized discrete components at the company's 150mm site in Tours; and migrating French 150mm activity to the 200mm fab at the company's Rousset site near Aix en Provence. The Rennes fab, with 428 employees under permanent contract and 34 employees scheduled to take early retirement, is the company's smallest 150mm fab, STMicro said. Its location within the city of Rennes prevents the site from expanding to accommodate larger wafer sizes, the company claimed. STMicro's Tours site focuses on highly specialized technologies and markets and is therefore not affected by the same competitive pressures that affect high-volume 150mm wafer fabs. At the Rousset location, migration from 150mm wafers began in May 2000 when STMicro opened a 200mm fab at the site, and it plans to gradually phase out 150mm production completely at that site. The Rousset site is the company's main location for fabricating ICs for MCU-based smart cards. Production at the Rennes site will gradually decrease before stopping completely by March of next year, ST Micro said. Assembling and testing components for the space industry, which also takes place at the Rennes site and cannot continue there on its own, according to the company, will be transferred to another STMicro site in Europe. STMicro said it would offer jobs at its other sites in France to all Rennes employees, at equivalent professional conditions. The transfers would be accompanied by an incentive package that includes relocation for the employee and his or her spouse, and any necessary training programs, according to the company. For employees who do not accept a transfer, the company would provide aid or assistance, such as training programs and help in finding a job outside the company, STMicro said. The company currently has 384 permanent positions that need to be filled in France. As for establishing new business at the Rennes site, STMicro said that a business diversification committee, created as part of a French government program, considered converting the fab to MEMS production or R&D work. But MEMS is currently a highly competitive, low volume business, and R&D activities alone wouldn't sustain the site, STMicro said. The company pledged to continue efforts to attract other companies to the Rennes site.