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UMC struggling to ramp 300mm fabs in 2006 |
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Oct 25, 2006 at 04:15 PM |
 UMC, the second largest pure-play semiconductor foundry, is continuing to struggle to ramp its leading edge 300mm fabs in 2006. Cited by UMC executives as a key priority this year, especially resuming the ramp at Fab 12i in Singapore after stalling in the second half of 2005 (see figure 1 below), the foundry has seen only a small increase in wafer starts in the first nine months of 2006 (see figure 2 below).
UMC has revealed in its third quarter financial results that Fab 12i is expected to reach 16,888wspm (300mm wafers) by the end of 2006. This would mean UMC has only been able to ramp the fab by an extra 2,814 wafers per month for the whole year.
However, the ramp is gaining some momentum since 1Q06. UMC was able to ramp Fab 12i up a further 592wspm by end of 2Q06 and by a further 889wspm at the end of 3Q06. The biggest increase in wafer starts, according to the company, will actually occur by the end of 4Q06 as wafer starts are expected to increase by 1,333wspm.
With the fortunes at Fab 12i improving, Fab 12a, UMC's oldest 300mm facility is now struggling to add more capacity as demand softens. After an early year spurt that saw the fab reach 28,296wspm in 2Q06 compared to 26,374wspm in 1Q06, the fab is only expected to reach 28,592wspm by year end.
UMC reiterated that its capital spending budget was still on target at $1 billion for 2006 yet had spent only $566 million in the first nine months of the year, with 87 percent of the year's CapEx being allocated to its 300mm fabs.
With 300mm capacity being expanded while demand softens, UMC now expects overall fab utilization rates to decline in 4Q06. Having increased slightly in previous quarters, reaching 82 percent in 3Q06, the company is projecting utilization rates of 75 percent in 4Q06.
Figure 1
Figure 2
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