December 19, 2007 – Keeping with its “flexible manufacturing” (i.e. fab-lite) initiative, Cypress Semiconductor says it will “exit” its Fab 2 chip factory in Round Rock, TX by late 2008, transitioning the production work to its newer 200mm Fab 4 in Bloomington, MN, and to external foundry partners.

Shahin Sharifzadeh, EVP of manufacturing, explained in a statement that although the mature (0.35-micron/150mm) Fab 2 “is a very efficient and well-run operation,” the company has determined it is more cost effective to shift manufacturing to Fab IV, where all of its newer products are being designed on more advanced process technologies, rather than attempt to retool Fab 2. Plus, he added, there is “ample cost-competitive foundry capacity in Asia.”

Sharifzadeh said there will be a “long timeline” for transitioning the work out of Fab 2, and the company anticipates a “smooth product manufacturing transition with no customer impact.”

He added for any potential buyers out there that Fab 2 would be ideally suited” for making custom analog parts, or for someone who is looking to establish US manufacturing operations to make products targeting domestic markets.

Opened in 1986 and expanded in 1999, Cypress’ Fab 2 has most recently been making legacy USB, programmable logic, timing and communications devices, employing 245 workers. Fab 4, opened in 1995 as the company’s first 200mm facility, produces the company’s SRAM products including specialty memories, as well as CMOS image sensors, employing about 400.