PARIS — The blade fell today. Described as inevitable measures, NXP, formerly Philips Semiconductors, announced it will restructure its manufacturing, R&D and support activities, impacting upon about 4,500 jobs, or about 15 percent of NXP's global workforce. In an interview with EE Times Europe, NXP's CEO Frans van Houten, expresses himself on the causes and consequences of such restructuring measures and inferred that NXP's wireless joint venture with STMicroelectronics NV has sparked off the move.
EETimes Europe: How long will this restructuring plan last? Can we imagine that, by the time it is completed, it will be time to close Hamburg and Nijmegen fabs?
Frans van Houten: This restructuring plan covers a period between now and 2010, so roughly two years. We have announced that we will close parts of Nijmegen and Hamburg [units]. We will upgrade the production from the 5- and 6-inch fabs in Nijmegen and Hamburg to 8-inch, so effectively upgrading to a higher technology base.
EETimes Europe: So, you have basically no intention to close those two units in two years?
van Houten: No, we only close some production facilities there.
EETimes Europe: The European semiconductor industry is going fablite and is on its way to becoming fabless, as NXP, Infineon and STMicroelectronics have been disposing of their leading-edge manufacturing capability. Will NXP ultimately become fabless? If yes, when can we expect such move?
van Houten: We will not become fabless. We will continue with manufacturing in those areas where we can add value such as in our automotive and multi-market semiconductor activities. There, an integrated manufacturing operation still makes sense.
In the area where we feel we cannot compete, such as the advanced CMOS areas and in the 300-mm wafers, this is where we will use external foundries.
EETimes Europe: What is NXP's fab utilization rate today? What will it be once the redesign program is ended?
van Houten: Our loading is now, depending on the factory, in the low 70s [percent]. We expect or we strive to reach the loading after we take capacity out towards the 90s [percent].
EETimes Europe: What is the percentage of outsourced production today? What will it be once the redesign program is finalized?
van Houten: We have not published our outsourced production percentage after we have separated the wireless activity so I cannot elucidate that question.
EETimes Europe: What are the foundries you are currently working with? Will it remain the same tomorrow?
van Houten: We have partnerships, among others, with TSMC and a few others like ASMC in China. We will review from time to time who the most competitive partner is and adjust our outsourcing accordingly.
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