According to Semiconductor Manufacturing International (SMIC), the US$1.86 billion the foundry recently committed to semiconductor equipment purchases will go toward 12-inch wafer capacity expansion in Beijing, Shanghai and Wuhan in China.

SMIC's 12-inch fab in Shanghai will enter production in June while its Wuhan plant will see equipment move-in between September and October, with test runs to commence by year-end at the soonest. The Wuhan plant will provide Elpida with standard DRAM parts using processes more advanced than the 70nm sector, SMIC indicated.

At the US-China Hi-Tech Cooperation Forum, Sam T. Wang, president of SMIC Americas and the representative in signing the LOIs, said 40% of the orders SMIC landed for the first quarter came from the US, which was the top region in terms of the proportion of orders it had during the period. In addition, the China market accounted for 12.8% of the overall orders, Wang said.

SMIC is spending about US$720 million in 2007 and the LOIs ensure that the company will spend at least US$600 million per year within the next three years, sources said.

The move is a significant step for SMIC as well as China-based semiconductor companies since semiconductor equipment has been rated by the US government as one of the closely-regulated items of high-tech export, the sources added.

By: Docmemory
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