Semiconductor market news | Operations are normal at chipmaker SMIC’s Shanghai plants;STMicroelectronics: Prices of all product lines increased in 2Q22…

1. Operations are normal at chipmaker SMIC's Shanghai plants

Chinese chipmaker Semiconductor Manufacturing International Corporation said operations remain normal at its Shanghai factories, state media outlet China Securities Journal reported on Monday.

According to SMIC’s official website, SMIC is headquartered in Shanghai, China and has a global manufacturing and service base. It has three 8-inch fabs and three 12-inch fabs in Shanghai, Beijing, Tianjin, and Shenzhen; Shanghai, Beijing, and Shenzhen each have a 12-inch fab under construction. It is worth mentioning that the 300mm fab in Shanghai is also SMIC’s most advanced FinFET process fab. The 14nm and improved 12nm processes are produced here, with a designed capacity of 35,000 wafers per month.

The city of Shanghai is undergoing a two-stage lockdown over the course of nine days as the local asymptomatic COVID-19 case count surges.

2. STMicroelectronics: Prices of all product lines increased in 2Q22

According to supply chain, STMicroelectronics issued a notice to its authorized distributors yesterday that it will raise prices in the second quarter.

ST said in a notice that the ongoing global Semiconductor shortage, together with the economical and geopolitical situation, has seriously affected the semiconductor industry, and there is no sign of a short-term recovery.

“While we keep investing strongly in manufacturing, the cost of raw materials, along with energy and logistic costs have reached a level which cannot be absorbed by STMicroelectronics in full,” ST said.

For these reasons, ST will increase prices for all product lines, including existing backlogs, in the second quarter of 2022.

3. Tesla's German gigafactory finally opens

Tesla's German Gigafactory started handing over cars to customers on March 22, 2022 after nearly nine months of delay.

The Berlin-Brandenburg factory, which is located in the town of Grünheide near Berlin, was slated to open on July 1, 2021, but permitting issues and protests by local environmentalists postponed its grand opening.

The factory is Tesla's first in Europe and key to the company's expansion plans. Tesla said in a press release sent to Insider it is hoping to eventually produce 500,000 vehicles per year at the new Gigafactory.

Tesla said it delivered 30 Model Y vehicles on its first day of production.

It added that 3,000 employees have begun work at the factory and it plans to hire "thousands more in the coming months." Per Tesla, the factory can accommodate a maximum of about 12,000 workers.

4. Kioxia begins construction of 3D-NAND flash fab

Kioxia Corp. has announced that the construction of its K2 wafer fab for 3D-NAND flash memory production at its Kitakami campus, in Iwate prefecture, Japan, will begin in April 2022.

Construction is expected to be completed in 2023. The 136,000 square meter site is adjacent to an established wafer fab. K2 will make use of artificial intelligence systems to increase production capacity across the entire site.

It will have an earthquake-resistant architectural structure and energy-saving manufacturing equipment and renewable energy sources.

Kioxia said it plans to hold discussions with Western Digital with regard to expanding the established flash memory joint venture between the companies to the K2 investment.

5. Toshiba to spend $840 million to expand power semiconductor production capacity

According to reports, Toshiba will increase capital expenditure in the new fiscal year starting in April to expand the production capacity of power Semiconductor devices at its main production base.

Toshiba Electronics has earmarked an investment of 100 billion yen (approximately $840 million) for fiscal 2022, about 45% higher than its estimate of 69 billion yen for fiscal 2021.

The funding will build a new manufacturing facility for Toshiba’s production subsidiary, Kaga Toshiba Electronics Corporation, which is scheduled to start in spring 2023. The expansion also includes the installation of a new production line within the existing structure. The expansion is expected to increase Toshiba’s power semiconductor production capacity by about 150%.

The report also revealed that Toshiba will also expand its investment in hard drives. Toshiba has developed technology to increase storage capacity to over 30 TB, more than 70% higher than currently available levels, and is committed to accelerating its commercialization.

6. SEMI: Global Fab Equipment Spending to Top $107 Billion in 2022

Global fab equipment spending for front-end facilities is expected to jump 18% year-over-year (YOY) to an all-time high of US$107 billion in 2022, marking a third consecutive year of growth following a 42% surge in 2021, SEMI announced in its latest quarterly World Fab Forecast report.

“Crossing the $100 billion mark in spending on global fab equipment for the first time is a historic milestone for the semiconductor industry,” said Ajit Manocha, president and CEO of SEMI. “This significant achievement is a tribute to the relentless drive to add and upgrade capacity to address a diverse range of markets and emerging applications, solidifying expectations for long-term industry growth to enable electronics for the digital world.”

“Global fab equipment spending is forecast to have another healthy year in 2023 and is expected to remain above the $100 billion mark,” said Sanjay Malhotra, VP of corporate marketing and the market intelligence yeam at SEMI. “We expect global semiconductor capacity to maintain steady growth this year and in 2023.”

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