Tower also secured the first volume order for the so-called Fab 2 plant from Alliance Semiconductor Inc., according to the company, based in Migdal Haemek. Tower's Fab 2 plant, which has been in the works for several months, is an 8-inch, 0.18-micron plant capable of making 33,000 wafers a month.

Yoav Nissan-Cohen, the outgoing co-CEO for Tower, dismissed reports from Dow Jones on Monday that the company has delayed Fab 2, due to the downturn and financial reasons. In March, Nissan-Cohen and co-CEO Rafi Levin of Tower for the last ten years, resigned.

Tower is producing wafers in Fab 2 right now, although the ramp is slower than the company originally expected, Nissan-Cohen said. Fab 2 “is up and running,” he said. “We are adjusting the ramp to market realities,” he said in an interview.

The company is making a “few thousand” wafers in the plant right now, with plans to expand to 10,000 wafer starts per month by the beginning of next year, he said.

It has shipped prototype chips to its various investors. Its strategic partners and investors for the fab include SanDisk Corp., Alliance Semiconductor Corp., Macronix International Co. and QuickLogic Corp. Tower's four wafer partners invested approximately $75 million in Tower for Fab 2's construction.

Today, Alliance said it has placed the first volume order for the plant. Tower will make 4-megabit asynchronous SRAMs in the plant, based on its 0.18-micron process technology. Tower expects to begin commercial shipments of the product in mid-2003.

"This order marks a key milestone for Fab 2 and for Tower. By starting volume production we are on our way to filling our new fab's capacity, which is a vital part of our global growth strategy," said Harold Blomquist, senior vice president of Tower Semiconductor and chief executive officer of Tower Semiconductor USA, in a statement.

By: DocMemory
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