Following much speculation ever since Macronix International Co., a Taiwanese chipmaker, announced its intention to sell its 150mm fab, yesterday the buyer of the foundry finally emerged: Foxconn. Previously, Tesla was rumored to be one of the bidders.
Semiconductor has risen to be the linchpin of the electronics contract manufacturer’s strategy, especially given its latest push into the EV sector. Young Liu, Foxconn chairman, has set the goal to push Foxconn’s profit margin to 10%, and placed his hope on manufacturing EV components, which typically has a profit margin between 20%-30% – similar to those of Tier 1 automobile suppliers like Bosch and Continental.
The acquisition costed Foxconn NTD 2.5 billion, and the transfer of the foundry would be fully completed before the end of 2021. According to Liu, Foxconn will use the newly acquired foundry to manufacture SiC-based power semiconductors, with an initial monthly capacity of 150,00 wafers, enough to supply 30,000 electric vehicles. Apart from SiC-based products, the fab will also produce other silicon-based products like MEMS.
However, Foxconn’s third-generation semiconductor ambition means that it will have to upgrade the current equipment in the fab. Greater challenge also awaits: how does Foxconn plan to catch up with industry peers who have already accumulated years of experiences to boost the yield of compound semiconductor products? One solution lies in the Nanotechnology Research Center co-founded by Foxconn and China’s Tshinghua University, as revealed by Liu.
Despite the long road ahead, the successful acquisition means that Foxconn will have three fabs under its control. As early as 2016, Foxconn already obtained a 200mm fab in Fukuyama when it acquired Sharp. This year, it acquired shares in SilTerra, a Malaysia-based 200mm foundry, after failing to purchase the foundry. Meanwhile, Foxconn has also invested in an advanced chip packaging facility in China’s costal city Qingdao, together with China’s state-owned Rongkong Group, and partnered with Yageo Corp. to provide small ICs for EVs.
Counting Foxconn as one of its biggest customers, Macronix has been the second largest provider of NOR Flash for Automotive. The two companies are also cooperating to expand their footprints in the growing EV market. With the sale of the foundry, Macronix expects to expand its 300mm fab, focusing on its NOR Flash and 3D NAND Flash business.