By Mark LaPedus, SemiMD senior editor

After implementing a number of major changes in 2011, silicon foundry vendor GlobalFoundries Inc. is starting off with a bang in 2012: The company’s 300-mm fab in New York has moved into initial production — with the help of IBM Corp. In addition, GlobalFoundries will also create more jobs in the United States this year.

As part of its major announcement, GlobalFoundries as well as IBM on Monday (Jan. 9) announced an agreement to jointly manufacture advanced chips at both companies’ semiconductor fabs. The new products recently began initial production at IBM’s 300mm fab in East Fishkill, N.Y. and GlobalFoundries’ Fab 8 plant.

Construction of GlobalFoundries’ $4.2 billion New York plant —  dubbed Fab 8 — began in July of 2009 , with tool installations taking place since that time. The fab is located at the Luther Forest Technology Campus in Saratoga County, New York. Other foundry vendors, namely Samsung and TSMC, have also talked about new fabs or plant expansion programs amid a downturn in the IC market.

For some time, GlobalFoundries has been running “development wafers” within Fab 8, according to the company. Now, GlobalFoundries has reached a major milestone: After years of development, the company has produced the first silicon within Fab 8. The devices will ramp to volume production in the second half of 2012.

A spokesman for GlobalFoundries did not elaborate on the types of devices produced at the fab. The undisclosed chips are based on IBM’s 32nm, silicon-on-insulator (SOI) technology, which was jointly developed with GlobalFoundries and other members of IBM’s process development alliance.

The process development alliance includes GlobalFoundries, IBM and Samsung. There was also research conducted at Albany’s College of Nanoscale Science and Engineering.

“Today’s announcement is a natural extension of our longstanding partnership with IBM that includes production of 65nm and 45nm chips at our fabs in Singapore and Germany,” said Ajit Manocha, CEO of GlobalFoundries. “With the addition of our newest factory in New York, we will now be jointly producing chips with IBM at four fabs on three continents.”

GlobalFoundries also has 300mm fabs in Dresden, Germany and Singapore. It also operates 200mm manufacturing facilities in Singapore.

Thanks to GlobalFoundries and IBM, the big news is that chip manufacturing continues to expand in New York. “IBM has helped make New York State one of the world’s premier locations for semiconductor design and manufacturing,” said Michael Cadigan, general manager of IBM Microelectronics. “Recently, we announced that we would spend $3.6 billion researching and developing new silicon technology in New York. We bring the skills, investments and partnerships that keep New York at the forefront of advanced silicon development and manufacturing.”

In another boost to New York, GlobalFoundries this week will hold a career fair in Saratoga County. The company has some 1,000 employees at Fab 8. The goal is to hire “400 more this year,” according to the spokesman.

Clearly, the Fab 8 announcement represents a major development for GlobalFoundries, which has also seen a series of changes. For example, in October, GlobalFoundries named Manocha as its chief executive on a permanent basis. He had served as interim CEO since June of 2011.

At that time, Doug Grose, the CEO of GlobalFoundries since its inception in 2009, resigned and was replaced by Manocha. Also departing was chief operating officer Chia Song Hwee, who earlier served as the CEO of Chartered Semiconductor until it merged with GlobalFoundries in late 2009.

Until June, Manocha had been an advisor to ATIC, now a subsidiary of the Mubadala Development Company which owns more than 80 percent of GlobalFoundries.

Since Manocha’s appointment, GlobalFoundries has realigned its management ranks and accelerated its technology efforts. The company has also moved aggressively on the 450mm front. As reported, five major chip makers — Intel, IBM, GlobalFoundries, TSMC and Samsung — in September launched a new consortium in New York aimed at propelling the 450-mm wafer transition.

In total, Globalfoundries plans to spend $3 billion on plants and equipment in 2012, Manocha said in a report from Bloomberg.

It’s no secret that GlobalFoundries had some yield issues at 32nm. This in turn impacted one of its key foundry partners: Advanced Micro Devices Inc. and its Llano devices. AMD’s codenamed Llano line of “Accelerated Processing Units” (APUs) are designed for notebook, ultrathin and desktop PCs.

In recent times, GlobalFoundries has moved to resolve the issue. “Our checks indicate AMD has been able to resolve some of the Llano supply issues in early C4Q11. Our checks indicate Llano supply has improved and OEMs-ODMs have been able to get supply,” said Vijay Rakesh, an analyst with investment banking firm Sterne Agee, in a recent report. “We continue to believe AMD will deliver competitive Llano-Bulldozer and slowly chip away at market share as the AMD price points are competitive enough for AMD to gain market share versus Intel in 2012.”

In September, AMD announced revenue shipments of the first processors based on its new x86 “Bulldozer” architecture. Initial production of the world’s first 16-core x86 processor, codenamed “Interlagos,” began in August and shipping to customers is underway.

Still, all foundries face a big challenge in 2012: A slow chip market. “With spending from certain players adjusted higher for 2011, and given our expectations for foundry spending to surprise to the upside in 2012, we estimate 2012 capex down (about) 7 percent in 2012,” said C.J. Muse, an analyst with Barclays Capital. Foundry capital spending is expected to hit $18.374 billion in 2012, flat from last year, according to the firm.

On the other hand, there is still demand at the leading edge. “Our work suggests that, based on the needs of the chipmakers with the most aggressive shrink roadmaps — namely Nvidia, AMD, Apple, and Samsung — approximately 59,000 (wafers) of 28nm capacity and (about) 43,000 of 32nm capacity will need to be added by the foundries in order to meet customer demand,” Muse said.

“Based on our bottom-up work factoring in 28nm demand out of Nvidia, AMD (ATI), Altera, Xilinx, and Qualcomm, we believe TSMC will need to add (about) 43,500 of 28nm capacity in 2012,” he said. “Our bottom-up work also suggests that Samsung LSI will need to add (about) 43,000 of 32nm capacity in 2012 to support Apple A6 production and internal Samsung apps processor demand. (GlobalFoundries) will add (about) 24,000 of 28nm capacity to support AMD’s MPU demand.”

Tags: GlobalFoundries, IBM, Samsung, TSMC

This entry was posted on Monday, January 9th, 2012 at 2:48 pm and is filed under News Stories. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.