June 1, 2010 – Confident in its place at the IC foundry table yet hungry for more, Globalfoundries says it will invest another $3B in new capacity expansions in the US and Europe.
In a nutshell the investments are two-pronged:
- In Europe: Build another wafer facility at Fab 12 in Dresden, targeting 45nm down to 28nm manufacturing and 22nm development. Add 110,000 sq. ft of cleanroom space, boosting overall output to 80,000 wafers/month. Groundbreaking will start immediately (subject to approval of a state & European Commission aid package), with first production slated for 2011.
A Globalfoundries spokesperson pegged the Dresden investment at about $1.4B-$1.5B.
- In the US: Expand its cleanroom shell currently under construction at the Luther Forest site in upstate New York — aka "Fab 8" — for more work at 28nm, 22nm, and 20nm. Add ~90,000 sq. ft of cleanroom space (to a total of 300,000 sq. ft), hiking overall site output to 60,000 wafers/month when fully ramped. Shell expansion would begin later this month (pending similar approval of support from state authorities), expected to come online in 2012 and volume production in 2013.
A Globalfoundries spokesperson pegged the NY investment at about $75M for the expanded cleanroom shell; if fully build out and tooled, the total investment in expanded Fab 8 capacity would amount to $2B.
Globalfoundries already in the midst of a 50% expansion at its Fab 7 in Singapore (i.e. recent acquiree Chartered Semiconductor) to 50,000 wafers/month output, focusing on 65nm-40nm process technologies.
In addition, Globalfoundries’ majority shareholder, Advanced Technology Investment Company (ATIC), has announced plans to create a tech cluster in Abu Dhabi, a 3km project adjacent to the Abu Dhabi airport. The site is aimed to be "the Middle Eastern hub of a global technology and manufacturing network to support the long-term deployment of capital for ATIC portfolio companies, in capital-intensive advanced technologies," the company said in a statement.
Fab capacity investments make for great press and hype, but it’s important to take a longer-term view. Given that groundbreaking is only tentatively slated to begin in the current year (pending aid approval). GF’s capacity expansion won’t really affect equipment/materials suppliers until 2011 (except that given ever-longer lead-times, some may start getting their ducks in a row sooner). Gartner research VP Bob Johnson expects that the investment won’t really impact the chipmaker’s 2010 spending plans — current-year capex is around $2.6B-$2.7B, he says, and that these new capacity increases will be financed by "shuffling things around." (Expanding the US operation now is also a much more economically savvy move than doing it later after the building’s completed, he added.) Look for a higher capex in 2011, he says.
Still, there’s no question that GF is making its mark in the foundry sector. Even if unchanged, the company’s 2010 capex would be four times what it spend in 2009, though still well behind sector leader TSMC. We are here, we are serious and we are a player," CEO Doug Grose told Bloomberg. "This foundry segment only has a couple of players who are serious — and we are one of them."