July 14, 2011
By: by Larry Rulison, Business Writer
Lack of incentive deal with GlobalFoundries likely to reverberate
MALTA -- When state economic development officials couldn't reach an incentive deal with GlobalFoundries on a second computer chip factory in Saratoga County last month, they may have also failed to land one of the semiconductor industry's next generation manufacturing plants.
Today, most chip companies make microprocessors on 8-inch and 12-inch silicon wafers using what's known as 200 millimeter and 300 millimeter technologies.
But the industry is planning new factories that will make chips on 18-inch -- or 450 millimeter -- wafers. The new facilities would mean billions of dollars more in capital spending.
GlobalFoundries is getting ready to install 300mm manufacturing equipment, also called "tools," in the factory it's building at Luther Forest Technology Campus in Malta.
That first fab is likely to end up costing $7 billion when it opens next year. But analysts estimate a 450mm fab could cost $10 billion.
With top competitor Taiwan Semiconductor Manufacturing Co. and chip giant Intel Corp. moving toward 450mm manufacturing, GlobalFoundries would likely have to move to 450mm also to stay competitive.
Although there are no concrete plans now for a 450mm fab, GlobalFoundries spokesman Jason Gorss says the move to 450mm is "inevitable" and the company is working now with its customers and suppliers to be prepared when the shift occurs.
"As we look at our future capacity expansion options, we are actively considering the preliminary specifications around 450mm tools in our design scenarios," Gorss said.
If GlobalFoundries considers Luther Forest for a 450mm fab, the presence of the industry's major 450mm research program at the Albany NanoTech complex 30 miles to the south could be a factor.
The program is a partnership between the University at Albany's College of Nanoscale Science and Engineering and Sematech, the international semiconductor research consortium that relocated to Albany from Austin, Texas.
NanoCollege spokesman Steve Janack said the 450mm program here is a "limited seed program" with about $30 million in funding. The industry will end up spending billions more as it makes the leap, he said.
"As we see it, the transition to 450mm is a reality," Janack said. "It is going to happen."
It's a hot topic at Semicon West, the annual tool manufacturing conference being held in San Francisco this week. Thomas Sonderman, vice president of manufacturing technology for GlobalFoundries, is one of several participants in a forum Thursday about the move to 450mm. Also on the panel is Paolo Gargini, director of technology strategy for Intel. The new fab Intel is building at its Hillsboro campus in Oregon is designed to handle 450mm tools even though it will begin using 300mm wafers when it opens in 2013, said spokesman Chuck Mulloy.
TSMC, which like GlobalFoundries is a "foundry" that does contract manufacturing for other chip companies, is planning a small 450mm manufacturing line in one of its fabs in either 2015 or 2016, said spokeswoman Elizabeth Sun.
"We have not decided whether it will be a retrofit or a new fab yet, since there will still be a few years before we get there," Sun said.