Chipmakers to spend NT$450 bil. on fabs

Taiwan Semiconductor, Powerchip Semiconductor Corp. and Vanguard International Semiconductor Corp. will spend the money in the next two years to build the plants in Hsinchu Science Park, northern Taiwan, the park’s management said in a statement distributed at a ground-breaking ceremony today.

Chipmakers in Taiwan are increasing capacity to gain market share from rivals including Korea’s Samsung Electronics Co. as demand rises for semiconductors used in computers and electronics such as digital music players. Global chip shipments will probably climb 24 percent this year, Daiwa Institute of Research Ltd. said in a report in January.

“There will be a chip shortage from the fourth quarter of this year,” Powerchip Chairman Frank Huang said at the ceremony.

Taiwan Semiconductor and Powerchip will construct two factories each, while Vanguard will build one, said Huang Der- ray, director-general of the Hsinchu Science Park Administration. The plants will cut semiconductors from silicon wafers measuring 12 inches in diameter.

The investments will create 10,000 jobs in Taiwan, the statement said.

Taiwan Semiconductor climbed 2 percent to NT$62.4 in Taipei trading yesterday, while the benchmark TAIEX index gained 1 percent. Powerchip shares fell 1.2 percent and Vanguard added 0.5 percent.

Hsinchu-based Taiwan Semiconductor said it will invest $5 billion and hire 3,000 people. Chairman Morris Chang declined at the event to provide details on the production schedule or capacity of the new facilities, which will use 30-nanometer or more advanced technologies.

Powerchip, Taiwan’s largest memory-chip maker, will spend NT$250 billion on the factories to make dynamic random access memory, or DRAM, using more advanced 50-nanometer technology, Chairman Frank Huang said.

DRAM is used in computers to store data temporarily to speed up processes. DRAM chips currently in mass production typically use 60-nanometer to 80-nanometer processes.

Huang said existing DRAM facilities will be converted to make Nand flash memory, which is used to store songs and videos in music players and cameras. In October, Powerchip announced plans for the new factories and said they would make Nand.

The new plants will increase Powerchip’s DRAM capacity by 30,000 wafers per month from the second quarter of next year, taking its total to 230,000, Huang said. Production will increase to 260,000 by the end of 2009.

Lin Chuan, chairman of Vanguard, 36 percent owned by Taiwan Semiconductor, didn’t provide capacity or other details. Robert Hsieh, vice president and spokesman of Hsinchu based Vanguard didn’t answer telephone calls to his office.

A nanometer, one billionth of a meter, measures the size of transistors within a chip. Lower metrics indicate more advanced technology that allows smaller, more efficient chips to be produced.

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