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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: FJB who wrote (19143)	5/26/2006 11:33:03 AM
From: niek	Read Replies (2) \| Respond to of 25522

AMD’s next 300mm fab to be announced next week! Friday, 26 May 2006 FabTech Editor blog. The German press is hopping with leaked information about AMD announcing a new 300mm fab at its Dresden cluster. Apparently the word is that this will be announced on Monday 29th of May. Strange call really, as the UK and America have holidays! Anyway the news, should it materialise is not surprising as Fab36 would be reaching full capacity by the end of 2007. Should demand remain strong in that period, AMD would need to outsource more capacity to its current foundry partner, Chartered Semiconductor, should Chartered have the capacity! The potential problem is that Chartered's ramp and growing customer base at its 300mm fab could also see the company close to capacity at that same time as AMD. Yes I know that means Chartered needs to announce a second 300mm fab sooner rather than later! We have highlighted in the 300mm Activity Report several times some companies have a good strategy of building new fabs in advance of capacity requirements and seamlessly bring on new fabs when required. Others have not done this and therefore go through a period of constrained capacity, only because decisions to build a new fab were not done quickly enough. AMD does not look like falling into this trap, though issues over how it will afford to build a new fab at the same time as ramping (the most expensive part) Fab36 are a concern. Saying that, AMD would probably need to find only about $250 million to $300 million for the construction phase—that would take about 10 months. Its friends in the Saxony Government could handle such a request as has previously occurred. The issue of a third fab at Dresden has always been on the cards, ever-since Fab30 was first planned. Architectural drawings created by AMA Group, AMD's official architects for the Dresden fabs at that time showed artist impressions of three fabs on the allocated land. Interestingly the eventual layout of Fab36 was different from those early plans which had the fabs more spread out than is actually the case. The space for the third fab is pretty much known as the hundreds of press that attended the opening of Fab36 last year stood on the spot to watch the opening ceremony in a small tented village erected especially for the event. The location runs parallel to Fab30 and just behind Fab36. Millions of tons of earth will have to removed as was the case with Fab36, but this didn't slow down the construction phase, even though this was done in winter months when normally such work would take longer. But due to a mild winter the earth removing phase went to schedule. This time I don't expect AMD and its construction companies to risk that scenario again so expect an earth moving period during the Summer/Autumn. Looks likely then that we can look forward to another visit to the lovely city of Dresden late next year for another opening ceremony perhaps! Funny Note: For Fab36's topping off ceremony we arrived with a coach load of European journalists straight from the airport and as the German Chancellor was attending there was very tight security. At the gates a very stern looking and sounding security guard came onto the coach and growled something about where were our passes? We didn't actually have any and a few people shouted out that we were press not VIP invites that had obviously been given such things. In a flash Mike Magee, founder and editor of the enquirer.net who happened to be sitting at the front of the coach rummaged into his bag and pulled out an A4 sized poster with Intel's logo on it and promptly or was it bravely—waved it at the guard and said " will this do?"