Taiwan’s United Microelectronics (UMC) will invest $5 billion on a new microchip factory in Singapore, with production expected to start in 2024 to support the boom in 5G and auto electronics.
UMC, which has already been producing semiconductors in Singapore for more than 20 years, said in a news statement that the new factory would produce 22 and 28 nanometre chips.
The fab (Fab12i P3) in Singapore will be one of the most advanced semiconductor foundries in Singapore, providing UMC’s 22/28nm processes. UMC will revise the company’s 2022 capex budget to $3.6 billion to account for the Fab12i expansion.
The semiconductor major said 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).
“The new fab is backed by customers who have signed supply agreements 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 (internet of things), and automotive mega-trends,” United Microelectronics said in a news statement.
The new fab will be next to an existing one, and will have a monthly capacity of 30,000 wafers, UMC added.
United Microelectronics said in 2021 it would spend T$100 billion ($3.57 billion) over the next three years to expand capacity and would guarantee supplies and prices to its clients as part of the plan, amid a global chip shortage that has hit automakers especially hard.
UMC Chairman Stan Hung said in the statement the semiconductor undersupply had crystallised the need for greater visibility and mutual risk mitigation within the industry.
Clients of United Microelectronics include America’s Qualcomm and Germany’s Infineon.
TSMC, Asia’s most valuable listed firm and globally the largest contract chipmaker, said last month it expected to lift capital spending to between $40 billion and $44 billion this year. Last year it spent $30 billion.
