Chartered Semiconductor Manufacturing Pte. Ltd. has quietly put the brakes on its manufacturing alliance with Lucent Technologies Inc.'s Microelectronics Group.
The Chartered/Lucent foundry venture, called Silicon Manufacturing Partners (SMP), was originally supposed to move to pilot-run production at its new 8-in.-wafer fab by year's end. The plan was to produce up to 26,000 wafers per month.
But due to overcapacity and pricing pressures in the worldwide foundry business, the joint venture's production schedule has been pushed out to mid-1999, said Barry Waite, Chartered's new president and chief executive, at a press event this week in Taipei.
The action follows Chartered's recent move to delay its joint-foundry venture with Hewlett-Packard Co. Also formed last year, that foundry venture, called Chartered Silicon Partners, was slated to move into production in early 1999 but has been pushed out to early 2000.
On the bright side, Waite said sales at the Singapore-based company will grow at least 20% in 1999. Chartered's 1998 sales were roughly
$400 million, making it the world's third-largest pure-play foundry; Taiwan Semiconductor Manufacturing Co. Ltd. and United Microelectronics Corp. rank first and second, respectively.
Chartered's actions are not surprising, especially at a time when there's a glut in the foundry market, said Joanne Itow, an analyst at Semico Research Corp., Phoenix. "It makes sense," she said. "[SMP] has been delayed to mid-1999, but it will be ready when business picks up."