Globalfoundries plans to boost production

Globalfoundries plans to boost production

Market news |
By Christoph Hammerschmidt

At Volkswagen, Daimler and Audi, production has recently come to a standstill time and again: there are not enough chips for the increasingly silicon-heavy vehicle electronics. What sometimes seems like a specific problem of the supposedly cumbersome and occasionally hubristic German car industry, in fact affects vehicle production in other countries just as much. The market research institute IHS Markit has calculated figures. According to these, in the first quarter of 2021 alone, the production of a good 670,000 vehicles worldwide will be affected in some form by the chip shortage. The supply problems will hit the Chinese industry hardest, where 250,000 fewer cars than planned can probably be built in this period because of the “chip famine”. The overstretching of global semiconductor production is reflected in massive delivery times – for MCUs, for example, an orderer must now allow for a delivery time of at least 26 weeks.

The bottleneck is probably due in large part to the concentration of automotive chip production in just a few fabs and foundries. According to IHS Markit, 70 per cent of the automotive semiconductors needed worldwide are manufactured by a single company, namely TSMC in Taiwan.

Now contract manufacturer Globalfoundries wants to seize the moment and increase the output of its fab in Dresden to one million wafer starts per year – about two and a half times the current capacity. The German-language industry blog published an interview with Manfred Horstmann, the head of Globalfoundries’ Dresden branch. In it, Horstmann confirmed these plans. The increased demand from the automotive industry will in some cases – by no means all – lead to concrete orders, Horstmann said. GlobalFoundries produces semiconductors for GPS and radar systems for use in cars, for example.

However, the car industry will have to be patient for a while yet, because GlobalFoudries already dropped out of the race for ever smaller chip structures years ago and has instead perfected its 22FDX production technology with structure widths of 22 nm under the slogan “More than Moore”. Horstmann is not planning to re-enter this race either; instead, he intends to include new applications such as artificial intelligence and, in particular, neuromorphic circuits in his product range – circuits that will probably be in greater demand in the automotive industry in the future, but which will not solve the current supply dilemma.

Horstmann’s strategy is to use the increased demand to boost the capacity of his plant. To do this, he wants to build a new production building and further increase the level of automation – which is already very high at the Dresden plant. The company did not want to comment on the investment sum, but media reports mention “significantly more than 1 billion euros”. In this context, GlobalFoundries hopes to receive funding from the EU’s IPCEI project. This pursues a rather long-term goal, namely to reduce Europe’s dependence on the Asian chip industry.

So it will probably take a few more years before production picks up speed at Globalfoundries. And the car industry will have to continue to exercise patience for a while.

More information:

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