Responding to its domestic rival, Japan's Shin-Etsu Chemical (SEH) said Wednesday (Sept. 20) that it has embarked on a major 300-mm silicon wafer expansion program at a total cost of $1 billion.

Tokyo-based SEH, the world's largest silicon wafer maker, said it plans to build two new 300-mm plants in Japan while expanding existing facilities in Japan and the U.S. In total, SEH said it hopes to expand its 300-mm silicon wafer production by 40 percent to 1 million units per month by fall 2007.

The bold expansion program is said to be in response to similar moves by SEH's Japanese rival. Changing the market landscape, Japan's Sumitomo Mitsubishi Silicon Corp. (Sumco) recently took control of rival silicon wafer maker Komatsu Electronic Metals Co. (KEM) from parent company, Komatsu Ltd.

Sumco (Tokyo), the No. 2 silicon wafer maker, also plans to raise its production capacity for 200-mm silicon wafers, according to a report. Besides a big expansion of 300-mm capacity, Sumco will boost its 200-mm silicon wafer production from about 1.2 million units a month to more than 1.3 million by the end of 2007, according to the report.

The moves are expected to increase Sumco's share of the silicon wafer market by 10 percent to 31 percent, according to reports. That would be "on par" with SEH.

In response, SEH plans to build two new 300-mm plants, including one next to its 200-mm plant in the Fukui Prefecture, according to Nikkei. Another 300-mm plant is expected to be build a plant in Nagano Prefecture, according to the report.

It will also expand on the 200-mm front. "In addition to the planned expansions at the Shin-Etsu Handotai's Shirakawa Plant in Japan and at Shin-Etsu Handotai America's facilities in Vancouver, Wash., to disperse risk, it was decided to produce single crystal ingots at Shin-Etsu Handotai's Takefu Plant [in Fukui Prefecture, Japan]," SEH said in a statement.

SEH has been working on expansion plans that would boost total production capacity of 300-mm silicon wafers to 500,000 per month by fall 2006.

"Due to the continuation of robust demand, this project was completed earlier than planned and . . . total production capacity has been currently increased to 700,000 [per] month," SEH said. "Shin-Etsu has now decided to establish a production system of 1,000,000 wafers [per] month by the fall of 2007."

In 2001, SEH claimed to be the first company in the world to begin mass production of 300-mm silicon wafers. Both SEH and Sumco are pulling way from their closest rivals, including MEMC, Siltronic and others.

Global silicon wafer area shipments increased 4 percent sequentially during the second quarter, according to Semiconductor Equipment and Materials International's Silicon Manufacturers Group quarterly analysis of the silicon wafer industry.

By: DocMemory
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