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France and Italy own 27.5 percent of the company and the subsidy could be allowed under the aegis of a European Commission instrument called IPCEI for Important project of common European interest.

ST had previously indicated it might upgrade a 200mm wafer fab at Crolles to run 300mm diameter wafers (see ST mulls capex expansion – and next 300mm wafer fab) but has now indicated to French publication Usine Nouvelle that it could build another 300mm wafer fab at Agrate near Milan, Italy.

The cost is expected to be €1.5 billion each (about $1.8 billion each) but it is not clear how much the French and Italian governments would contribute. Under the IPCEI instrument the German government is helping to finance the consruction of a €1 billion wafer fab by Bosch and expansion of FDSOI chip production capacity at GlobalFoundries, both in Dresden.

Over the last decade ST pulled back from the manufacturing of leading-edge digital ICs. It has become fabless in this area and outsources the manufacturing of ICs to foundries such as Taiwan Semiconductor Manufacturing Co. Ltd. However, it has also announced a strategy of differentiated manufacturing of specialized circuits in areas such as sensors, MEMS, photonics, power management, mixed-signal and RF circuits. ST’s manufacturing capabilities are now approaching full capacity.

“No decision has yet been taken by the board of directors,” Usine Nouvelle, quoted Nicolas Dufourcq, chairman of the supervisory board of ST, as saying. In the face of saturated production these two projects could be launched by 2021, Usine Nouvelle, quoted DUfourcq as saying.

Related links and articles:

www.st.com

Usine Nouvelle article

News articles:

Bosch to build wafer fab in Dresden

ST mulls capex expansion – and next 300mm wafer fab

Leti, Fraunhofer join forces on “strategic” nanoelectronics

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