Capacity to come online in 2024 to help alleviate chip shortage driven by mega-trends
United Microelectronics Corporation (NYSE: UMC; TWSE: 2303) (“UMC” or “The Company”), a leading global semiconductor foundry, today announced that its Board of Directors has approved a plan to build a new advanced manufacturing facility next to its existing 300mm fab (Fab12i) in Singapore. The first phase of this greenfield fab will have a monthly capacity of 30,000 wafers with production expected to commence in late 2024.
The new fab (Fab12i P3) will be one of the most advanced semiconductor foundries in Singapore, providing UMC’s 22/28nm processes. The planned investment for this project will be US$5 billion. UMC has operated as a pure-play foundry supplier in Singapore for more than 20 years and the location is also the company’s designated R&D center for advanced specialty technologies. To account for the Fab12i expansion, the company’s 2022 capex budget will be revised upward to US$3.6 billion.
The new fab is backed by customers who have signed multi-year supply agreements in order to secure capacity from 2024 and beyond, which points to robust demand outlook for UMC’s 22/28nm technologies for years to come, driven by 5G, IoT, and automotive mega-trends. Specialty technologies to be manufactured in the new facility, such as embedded high voltage, embedded non-volatile memory, RF-SOI, and mixed signal CMOS, are critical for a broad range of applications, including smartphones, smart home devices, and emerging electric vehicle applications. The company expects the new fab will play an important role in satisfying growing demand in these markets and help alleviate the structural shortage of foundry capacity, especially on 22/28nm processes.
Stan Hung, Chairman of UMC, said: “We are very excited to expand our 300mm operations in Singapore, which will enable the company to further diversify our manufacturing footprint. Over the past two decades, UMC has benefited from Singapore’s vision to attract high tech firms through strong infrastructure, ecosystem, and talent pool. Our Singapore fab is UMC’s flagship innovation hub and numerous new R&D projects in collaboration with customers will enter production when the new facility comes online. The semiconductor undersupply has crystallized the need for greater visibility and mutual risk mitigation within the industry. This investment is the result of the shared vision and close collaborations with our key customers. We are committed to doing our part to restore balance in the industry value chain and to the long-term success of our customers.”
Dr. Beh Swan Gin, Chairman of the Singapore Economic Development Board, said: “UMC plays an important role in Singapore’s semiconductor manufacturing sector. We strongly welcome and are pleased to support UMC in the expansion of its wafer fabrication and R&D operations in Singapore. This is in line with Singapore’s vision to further grow and deepen Singapore’s role in the global supply chain for semiconductors.”
About UMC
UMC (NYSE: UMC, TWSE: 2303) is a leading global semiconductor foundry company. The company provides high quality IC fabrication services, focusing on logic and various specialty technologies to serve all major sectors of the electronics industry. UMC’s comprehensive IC processing technologies and manufacturing solutions include Logic/Mixed-Signal, embedded High-Voltage, embedded Non-Volatile-Memory, RFSOI and BCD etc. Most of UMC's 12-in & 8-in fabs with its core R&D are located in Taiwan, with additional ones throughout Asia. UMC has total 12 fabs in production with combined capacity over 800,000 wafers per month (8-in equivalent), and all of them are certified with IATF-16949 automotive quality standard. UMC is headquartered in Hsinchu, Taiwan, plus local offices in United States, Europe, China, Japan, Korea & Singapore, with worldwide total 20,000 employees. For more information, please visit: http://www.umc.com.
About the Singapore Economic Development Board
The Singapore Economic Development Board (EDB), a government agency under the Ministry of Trade and Industry, is responsible for strategies that enhance Singapore’s position as a global centre for business, innovation, and talent. We undertake investment promotion and industry development, and work with international businesses, both foreign and local, by providing information, connection to partners and access to government incentives for their investments. Our mission is to create sustainable economic growth, with vibrant business and good job opportunities for Singapore and Singaporeans.
For more information on EDB, please visit www.edb.gov.sg
Note from UMC Concerning Forward-Looking Statements
Some of the statements in the foregoing announcement are forward-looking within the meaning of the U.S. Federal Securities laws, including statements about introduction of new services and technologies, future outsourcing, competition, wafer capacity, business relationships and market conditions. Investors are cautioned that actual events and results could differ materially from these statements as a result of a variety of factors, including conditions in the overall semiconductor market and economy; acceptance and demand for products from UMC; and technological and development risks. Further information regarding these and other risks is included in UMC’s filings with the U.S. Securities and Exchange Commission. UMC does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.
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