With enough optimism to fill a 10-gallon hat, a European holding company has hung out its shingle in Lubbock, Texas, as the industry's latest pure-play chip foundry.
Unfazed by prevailing overcapacity in the global semiconductor market, Belgium's Elex NV has bought an aging 6-in.-wafer fab from Texas Instruments Inc. and is offering customers what can best be characterized as trailing-edge foundry services.
The new subsidiary, with the mysterious name of X-Fab Texas, will be run by former executives of TI, which sold the facility after divesting the company's DRAM and flash-memory business last summer. The plant had been dedicated to the production of EEPROMs, flash memories, power ICs, and other CMOS-based chips, according to Dan Ax, X-Fab Texas' national sales manager.
The company officially opened its doors last week and is offering manufacturing processes of 0.5 micron and above. "There is still a big demand for 0.5-micron foundry capacity," insisted Ax, who recently left another Elex chip subsidiary, Melexis Inc., Webster, Mass.
Executives at several prominent foundries were surprised by Elex's move and said a new entrant will face an uphill battle in the market.
"We're also seeing strong demand for our older technology, so there is a market out there for 6-in. wafers," said Jim Ballingall, vice president of worldwide marketing for United Microelectronics Corp., Hsinchu, Taiwan. "But the trouble is that it's going to be difficult to compete against companies like ourselves."
X-Fab Texas is reported to be making select chips for TI, and is soliciting business from other companies while supporting a sister operation in Europe. For some time, Elex has owned and operated an obscure foundry in Erfurt, Germany, known as X-Fab Europe.
At present, X-Fab Texas has more than 80 employees, mostly from TI's former Lubbock operation. The fab, which is capable of making 15,000 wafers per month, could be upgraded to 8-in. production in the future, according to Ax.
While it may be ignoring industry trends, X-Fab Texas isn't the only foundry operating in the U.S. market. IBM Microelectronics has offered foundry services for years. And last year, WaferTech-a joint venture between Taiwan Semiconductor Manufacturing Co. Ltd. and several U.S. chip makers-began ramping a new 8-in., 0.35- to 0.25-micron fab in Camas, Wash.