Second chip fab sought to keep edge
Malta facility would help in competition with Taiwan rival
Globalfoundries would ideally like to build a second computer chip factory in Malta that would make 3 nanometer computer chips in order to keep pace with foundry giant Taiwan Semiconductor Manufacturing Co.
New Globalfoundries CEO Tom Caulfield, who used to run Globalfoundries’ current Fab 8 factory in Malta, told EE Times in a story published Monday that Globalfoundries needs to build another fab, although the location and technology node have yet to be determined.
In addition to Malta, Germany is an attractive option, especially because the government there offers generous subsidies that cover a quarter of the capital costs of a new fab.
“Saxony provides 25 cents on the dollar, but the U.S. doesn’t,” Caulfield told the EE Times. “It’s a policy that needs to be reconsidered because these things can drive jobs away.”
Caulfield and executives from Mubadala, the Abu Dhabi investment fund that owns Globalfoundries, were at Fab 8 and later in Washington, D.C., last week to drum up federal support for its operations in Saratoga County.
Rep. Paul Tonko, D-amsterdam told the Times Union the feds could support utility infrastructure, workforce development and research and development costs, although no dollar figures were revealed.
The federal government has an incentive to support Globalfoundries because the company is the sole supplier of high-end chips to the Department of Defense through a $755 million contract. Globalfoundries could make
the case that the U.S. would be investing in helping build a nextgeneration 3 nanometer chip fab that would be the most advanced in the world by far, providing the military with the most sophisticated chips on the planet.
Globalfoundries tapped into what is known as the Trusted Foundry program when it acquired IBM’S chip fab operations in East Fishkill and Burlington, Vt., in 2015 that made the military chips.
“This is important for national security and creating jobs,” Caulfield told EE Times. “Access to a secure domestic supply. We’ll work that angle.”
Globalfoundries is in a race with Taiwan Semiconductor, also called TSMC, to build a 3 nanometer fab, which is several generations ahead of the current commercial chips that use 14 nanometer architecture, with 7 nanometer chips on the way later this year.
TSMC owns more than half of the computer chip “foundry” market, making chips for other companies. As the No. 2 foundry,
Globalfoundries had $6 billion in sales in 2017. TSMC had $32 billion in sales last year.
IBM announced last year that it had developed 5 nanometer chip architecture at SUNY Polytechnic Institute in Albany where Globalfoundries does research and development for Fab 8. IBM says the 5 nanometer technology could be used to create 3 nanometer chips as well. The smaller the transistor architecture, the cheaper it is for a company to make better performing chips, although by 3 nanometers the industry is reaching the theoretical limit of shrinking transistors.
The Taiwan Semiconductor fab is expected to cost $15 billion and be ready for production by 2022, so Globalfoundries would have to get its own 3 nanometer fab up and running by then as well. However, Globalfoundries has operations in Singapore and China in addition to Malta and Dresden, Germany, which means Globalfoundries has options on where it can build. China would likely not work for 3 nanometer or Trusted Foundry for national security reasons, but Globalfoundries needs to share the costs in some way due
to the extraordinary costs of capital for the factories.
Globalfoundries is expanding Fab 8 to install new production machines to make 7 nanometer chips that will be ready later this year after perfecting 14 nanometer chips for customers like Advanced Micro Devices and IBM. It was assumed that the next generation would be 5 nanometer but Caulfield appears to have his eye on 3 nanometer.
Caulfield brought in Samsung to help make 14 nanometer chips at Fab 8, a move that helped turn around the fortunes of AMD. That is one of the reasons why Caulfield was named CEO. The other reason appears to get a new 3 nanometer fab built, preferably in Malta. Caulfield has also talked of bringing in a customer to partner on the new fab, somewhat like Samsung did at 14 nanometers when it used Fab 8 as a second source for its customers.
“I don’t know if 5 nanometer is enough to make a fabless company invest,” Caulfield told EE Times. “They need something as defined as 3 nanometer to get full performance, but we’re still looking at what is the right investment for the next node.”