TOKYO ( ChipWire) -- NEC Corp. will spend about $425 million to build new chip production capacity at facilities in Japan and Scotland, with most of the investment aimed at more than doubling the company's output of LCD driver ICs by year's end.
About $330 million will go to NEC's fab in Kansai, Japan to build a 4,200 meter2 cleanroom for the specialized high-voltage process required to manufacture driver ICs. NEC expects to produce 2 million devices per month at the facility starting in October, and will push volume production to 10 million pieces per month in 2001, an NEC spokesman said.
Half of the IC production at the Kansai facility will support the large-panel LCDs used in PC notebooks and desktop monitors, and half will be for the smaller, passive displays used in cell phones, the spokesman said.
NEC also intends to invest some $95 million in NEC Semiconductors U.K. in Livingston, Scotland, where the company will transition its process technology to 0.18-micron to support 128-Mbit DRAM production and the start of LCD driver IC production.
Last month, NEC announced it would increase driver IC production by outsourcing to Sanyo Electric the production of an additional 4 million devices per month. In addition, the company recently started to outsource driver IC production to its Tokin affiliate in Sendai, Japan, and has shifted production at Shougang NEC in Beijing from 4-Mbit DRAMs to driver ICs, the spokesman said.
Overall, NEC intends to increase its flat-panel driver IC production from 9 million units per month at the beginning of this year to 19 million per month by the end of the year. That should push NEC's share of the market from 20-30%, the spokesman said.
NEC's plans come on the heels of an announced partnership between Toshiba Corp. and Samsung Electronics Co. to produce complementary driver ICs for cellular phone displays. The companies intend to start mass production of 500,000 units a month in the third quarter, according to Toshiba.