SEMICONDUCTOR INDUSTRY
UPDATE
October 2019
McIlvaine Company
Sandia Labs National Security Chip Plant Gets an Upgrade
Cree Plans $1B Semiconductor Plant in Marcy, NY
New and modified equipment to sustain production for nuclear stockpile over
coming decades
ALBUQUERQUE, N.M. — Sandia National Laboratories has completed phase one of an
anticipated three-year upgrade at its plant responsible for making integrated
circuits, similar to computer chips. The facility is now fully compatible with
industry-standard, 8-inch silicon wafers — thin, round starting materials used
for making chips. Previously, Sandia used 6-inch wafers.
Supporting the new size will help sustain production of microsystems for
national security applications through 2040. Prototyping and product development
activities have already resumed.
“Moving to 8-inch wafers aligns us with industry, which means we have a more
sustainable supply of starting materials, tools and service,” said Sandia senior
manager Mike Holmes, who is overseeing the process.
Larger wafers are generally more cost-effective than smaller ones because more
devices can be made per wafer, Holmes said. That’s why they’ve been widely
adopted in industry.
Sandia’s decision, however, was driven by its national security mission. Six
years of planning ensured the conversion would not affect production of
components needed for national defense. Chips produced at Sandia can be found in
the nation’s nuclear stockpile.
Much of the site’s staff have taken on new roles to assist with the upgrade,
enabling Sandia to cover 85% of expenses with the facility’s regular operating
budget. The conversion has been underway since August 2018.
The fabrication plant is part of Sandia’s Microsystems Engineering, Science and
Applications (MESA) complex, which is world-renowned for producing high
reliability components that last for decades. It is a world leader in protecting
integrated circuits from otherwise damaging radiation.
The complex is also home to a research and development lab that invented the
world’s fastest digital X-ray camera, and a microfabrication plant supporting
production and research of compound semiconductor devices.
At MESA, the journey from a raw silicon wafer to a finished chip takes hundreds
of steps. Many specialized pieces of equipment handle, treat, build on, cut and
test manufactured components. Every machine that touches wafers had to be
modified or replaced.
This included the implanter, an 8-foot-tall, 19-year-old cube in which
electrically charged elements, or ions, are accelerated and embedded into the
wafers to tune their chemical and electrical properties. Construction crews had
to tear down a wall to get the machine out of the building. Then, they had to
raise the ceiling and reinforce the floor for its 10-foot-tall replacement.
Other upgraded systems included equipment that uses light to transfer geometric
patterns from stencils to precisely plot the locations of circuits, and
chemical-mechanical polishing tools that smooth and flatten surfaces for
multi-layer processing.
The tooling upgrade is the first of four steps toward the facility’s conversion.
The remaining three steps review and requalify the production line to ensure
products made using the new equipment are identical to ones produced by the old
equipment.
“Re-establishing the process on 8-inch wafers is extremely challenging,” Holmes
said. “We have to tune hundreds of interrelated parameters to get the same end
result as before but with different equipment and at a larger scale.”
This process, called requalification, is expected to be finished in 2021.
Sandia National Laboratories is a multimission laboratory operated by National
Technology and Engineering Solutions of Sandia LLC, a wholly owned subsidiary of
Honeywell International Inc., for the U.S. Department of Energy’s National
Nuclear Security Administration. Sandia Labs has major research and development
responsibilities in nuclear deterrence, global security, defense, energy
technologies and economic competitiveness, with main facilities in Albuquerque,
New Mexico, and Livermore, California.
Cree Plans $1B Semiconductor Plant in Marcy, NY
The Marcy Nanocenter is a 450-acre site that sits next to SUNY Polytechnic
Institute's Marcy campus outside Utica. Cree is planning a $1 billion silicon
carbide chip facility at the site, becoming the park's first tenant.
The manufacturing company Cree has announced plans to build a $1 billion chip
fabrication plant in the Utica suburb of Marcy, lured in part by a $500 million
incentive package from Empire State Development.
State and Cree officials were in Utica to announce details of the project, which
is expected to create 600 jobs over eight years. Gov. Andrew Cuomo, who had
planned to attend, addressed the group by phone after his aircraft experienced
mechanical problems.
"This, my friends, is just building on the momentum that we have going," Cuomo
told attendees of the Utica announcement. "All the arrows are pointed in the
right direction, and Cree coming is really going to jump start it all."
The Cree chip fab that will be built at SUNY Polytechnic Institute's Marcy
campus will make silicon carbide chips.
An existing wafer line at SUNY Poly's Albany campus will be upgraded by Cree to
make the commercial chips until the $1 billion Utica fab is up and running by
2022. Cree has also committed to $30 million in research and development
spending in partnership with the SUNY system, which will match $5 million of
that.
"This partnership is vital to strengthening the research and scientific assets
that New York state needs today, to attract the high-tech industries and jobs of
tomorrow," Cuomo said in a statement released before the announcement. "This is
a crucial step in cultivating the advanced manufacturing infrastructure of New
York state, growing the upstate economy and transforming the future of the
Mohawk Valley."
Howard Zemsky, the outgoing Empire State Development president and CEO, said
Cree's investment is a game changer for Utica, remarking on how the investment
the Mohawk Valley city has made in its downtown and other main corridors laid
the foundation.
"You can't say enough about the impact this industry is having across the board
on the economy," he said. "If you think about the Erie Canal and what has now
become a tech corridor, you think about all the ways we are realizing the
synergy in our investments."
The investment will also include $4.2 million from Mohawk Valley EDGE for
on-site and off-site job training, Zemsky said. The average salary for these
jobs is $75,000, he added.
Cree, headquartered in Durham, N.C. and probably best known to consumers for its
LED light bulbs, says it will save $280 million by agreeing to build what will
be called North Fab outside Utica. The fab helps the North Carolina company meet
a previously announced plan to expand its production to meet the need for
electronic power chips used in electric cars and 5G networks.
"Silicon carbide is one of the most pivotal technologies of our time, and is at
the heart of enabling innovation across a wide range of today's most
groundbreaking and revolutionary markets, including the transition from the
internal combustion engine to electric vehicles and the roll-out of ultra-fast
5G networks," Gregg Lowe, CEO of Cree, said of the reasons for building the $1
billion, 480,000-square-foot fab, which will be completed in 2020.
The state's deal with Cree to build in Oneida County came together quickly. Back
in May, Cree had announced plans to spend $1 billion to increase its production
of silicon carbide chips by 30 times its current capacity in its home state.
That May announcement coincided with Cree selling off its lighting business in a
$310 million deal that gave it capital to focus on its Wolfspeed semiconductor
business, which also produces gallium nitride radio frequency chips.
That plan was going to include the construction of a 253,000-square-foot factory
at its Durham, N.C. headquarters in an existing building that was going to cost
$450 million. That plan is being replaced by the Utica fab now, although Cree
will still build a $450 million "mega materials factory" in Durham that was
announced in May as well.
"Cree will be investing approximately $1 billion in construction, equipment and
other related costs for the New York fab," the company said in a press release
issued Monday morning. "New York state will provide a $500 million grant from
Empire State Development and Cree will be eligible for additional local
incentives and abatements as well as equipment and tooling from SUNY. As a
result, the company expects to realize a net capital savings of approximately
$280 million on our previously announced $1 billion capacity expansion through
2024. In addition, it will provide 25 percent increased output compared to the
previously planned facility."
Cree's fab outside Utica will build on the $500 million New York Power
Electronics Manufacturing Consortium that SUNY Poly created in 2014 with General
Electric to make silicon carbide power chips to help regulate power in
industrial electronic devices.
The NY-PEMC built a manufacturing line at SUNY Poly's Albany campus based on
silicon carbide manufacturing techniques that GE had developed at its research
lab in Niskayuna. Silicon carbide chips are much more durable and resilient than
power chips made from just silicon, and silicon carbide chips are about half the
size.
Danfoss Silicon Power was recruited to operate a manufacturing facility on SUNY
Poly's Utica campus to package the silicon carbide chips into power modules that
are used by GE and others. The power modules can reduce power consumption in
electric cars and data centers and other industrial devices.
Cree says between its Durham headquarters facilities and the future Utica fab,
the company will create a "silicon
carbide corridor" to make its power chips.
New York has struggled to find a tenant for the site. In late 2016, the Austrian
analog chip company AMS AG backed out of a $650 million deal with New York to
build a $2 billion factory at the site, known as the Marcy Nanocenter.
Texas Instruments considered building a new $3.1 billion computer chip factory
on the site before deciding this spring to build the plant outside of Dallas.
The state has been trying to bring a chip maker to the Marcy Nanocenter after
the site lost out in 2006 to the Luther Forest Technology Campus as the site for
what became GlobalFoundries' Fab 8 chip factory.
McIlvaine Company
Northfield, IL 60093-2743
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