AMD opens new 300-mm fab in Germany

DRESDEN, Germany — Advanced Micro Devices Inc. opened its first 300-mm fab here Friday (Oct. 14), with outgoing German Chancellor Gerhardt Schroeder lauding the jobs created in this relatively depressed area of the former East Germany.

AMD CEO Hector Ruiz said that Fab 36 opens "at the perfect time, when AMD has its strongest process position ever."

About 500 people attended the grand opening event.

Schroeder used his speech here to encourage Germans to be more confident about their ability to compete in the global microelectronics industry. Fab 36, he said, “is an impressive signal for all Germans, it is a beacon which shows that Germany is still an attractive place for business. Germans should take heart and be a bit more proud.”

Ruiz said Fab 36 "can more than double our existing capability, and we will fully utilize it to gain [market] share" against rival Intel Corp. Ruiz said that when Fab 36 is fully utilized next year, it will give AMD the ability to make about 100 million processors a year, compared with about 50 million annually now.

As measured in dollars, AMD now has roughly 10 percent of the X86 market, but sales in 2005 are growing at roughly a 40-percent clip compared with the year earlier period, said chief financial officer Bob Rivet.

With Fab 36 aimed at 65-nm design rules, Ruiz said AMD's 200-mm Fab 30 facility, where virtually all of AMDs microprocessors are currently made, may be used to make chip sets and processors needed for low-cost systems aimed at the developing world or for embedded systems.

Total investment in the Dresden fabs is expected to reach $5 billion this year, and subsidies from the German government and the state of Saxony will total about $500 million, said Hans Deppe, president of AMD Saxony.

If AMD continues to gain market share, Ruiz said it will need another fab in the 2008 time frame. Dresden again will be considered, but other locations also are possible, he added.

He said AMD plans to add about 600 jobs at Fab 36, and will employ a total of 3,000 workers here by 2006.