United Microelectronics (UMC), the world's second-largest contract chip maker, announced its second chip fabrication plant to make 300mm silicon wafers has begun commercial production.
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The plant, located in Singapore, is run by UMC subsidiary UMCi and began pilot production last year.
UMC expected the plant to produce 10,000 wafers per month by the end of 2004, giving the company added production capacity at a time when contract chip makers, including UMC and rival Taiwan Semiconductor Manufacturing (TSMC), are seeing their capacity utilisation rates hit levels close to 100%.
UMCi is UMC's second 300mm plant to enter commercial production. The company's first 300mm plant, Fab 12A, is located in Taiwan and began commercial production in 2002.
Fab 12A is expected to produce 20,000 wafers a month by the end of this year.
With a significantly larger surface area, 300mm diameter wafers can produce up to two and a half times more chips than is possible with the 200mm wafers. This translates into lower production costs for chips and increased productivity.
UMC also announced this week it had completed the acquisition of a 200mm plant in Hsinchu, Taiwan, formerly owned by Taiwanese chip supplier Silicon Integrated Systems for $320.4m.
The company said it hoped to expand production capacity quickly without incurring the costs of constructing a new plant.
Sumner Lemon writes for IDG News Service