AMS pulls out of $2 billion wafer fab project

January 15, 2017 // By Peter Clarke
Austria's AMS AG (Premstaetten, Austria) has withdrawn from a wafer fab project located in New York that was budgeted with a spend of $2 billion over twenty years.

AMS, a developer of analog, mixed-signal ICs and sensors, has held discussions with foundry Taiwan Semiconductor Manufacturing Co. Ltd. (Hsinchu, Taiwan) about making increased use of its services as an alternative, according to an AMS executive.

The wafer fab project, based at Marcy in the Mohawk Valley in upstate New York, had already broken ground with a ceremony back in April 2016 but reports started to appear of problems and of a lack of activity on the site in December 2016.

AMS issued a statement later in December that it had decided to withdraw from the project because of "further delays outside AMS' control"

The statement quoted CEO Alexander Everke saying: "this decision was taken after thorough evaluation of the wafer fabrication project and its current status. We see no impact to our financial targets including our stated profitability expectations as we have a strong mix of internal and ample external capacity available to implement our strategy."

The project – originally negotiated by AMS's previous CEO Kirk Laney – was unusual in that the fab shell suitable for manufacturing on wafers of 200mm and 300mm diameter was due to be built and owned by the State of New York and leased to AMS (see Austria's AMS is shopping for a wafer fab and AMS plans to rent a wafer fab in New York). AMS planned to rent the operational wafer fab for a period of 20 years for a nominal yearly amount and only incur operating expenses on the wafers produced. AMS would still have had to invest in production equipment but that ramp up would be under its control and could be done as slowly or quickly as customer demand indicated.

AMS was due to work in partnership with New York State and the State University of New York (SUNY) Polytechnic and the College of Nanoscience and Engineering (CNSE) to build, staff and operate the 200/300mm wafer fab. It was due to create 700 full time jobs and 500 additional jobs for contractors, sub-contractors, suppliers and partners.

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