The world’s largest memory chip maker said it would invest 2.25 trillion won to build a brand new 300-mm wafer facility in its Hwaseong campus, which is to purely dedicated to production of applications processor chips, or APs, the brain of samrtphones and tablet PCs.
The Hwaseong campus is a hub of Samsung’s memory and system LSI chip production, one and half a hour drive away from capital Seoul, to produce SOC chips
Construction of the 300mm wafer fabrication facility will start sometime in June and chips will start to roll off the line by the end of 2013 using cutting-edge 20nano and 14nano node design rule technology.
The announcement caps a spate of its recent capital spending sprees, standing in stark contrast with other recession-stricken chipmakers, who are shelving their capital investments, or put their facilities up for sale on fears that sales recessions would protract longer than expected.
Just a couple of months year after the chipmaker had completed a 300-mm wafer line in late 2011 to produce DRAM and NAND flash memory chips, for example, Samsung announced in May that it would establish a purely dedicated 300mm wafer facility for NAND chips Xian, China.
The chipmaker aims to balance its capital spending and revenue portfolio by accelerating its business diversification efforts away from notoriously volatile and marginally profitable memory chips into more lucrative AP chips.
As the proliferation of smartphones and tablet is now boosting up demand for AP chips, Samsung is also in dire need for more production capacity to meet demand from its captive market –Samsung’s mobile phone business. The chip maker also will be able to dedicate much of its capacity to its foundry business, which doesn’t design, but just manufacture chips of others’ design. Apple has been outsourcing production of its AP chips to Samsung.
Mr. Stephen Woo, president of Samsung Electronics’ System LSI Business, said, “With the construction of our new System LSI fabrication line, Samsung will be able to respond to the demand of the global IT industry and strengthen our ability to support our customers’ requirements even further.”
The new 300-mm wafer lines is one more addition to Samsung’s constellation of current two SOC chip fabrication lines, which are known as Lines 9 and 14 Line,
The chip maker is also running one more 300-mm wafer line for production of applications processors in Austin, Texas, the U.S., which mainly produce AP chips for Apple Inc.