Micron expands S'pore testing facility

To meet rising demands in Asia, the chip maker has pumped in US$250 million to enlarge its test-and-assemble plant in Singapore.

SINGAPORE--Micron has expanded its assembly and testing facility in Singapore to meet the region's growing chip demands.

The US$250 million expanded facility is part of the U.S.-based semiconductor maker's efforts to shift its manufacturing activities to Asia, Steve Appleton, the company's chairman and CEO, said today at the extended-facility's opening ceremony.

"Wafers produced in the United States used to be assembled there, but they can now be shipped and assembled in Singapore," Appleton said, adding that slightly less than half of the company's chips will be assembled at its plant here. Asia makes up about 40 per cent of the company's worldwide sales.

Spread over 24,600 square meters, the facility houses sophisticated equipment to assemble and test a range of semiconductor components such as memory modules and image sensors.

Only 30 percent of the facility's floor space will be used initially, with the remainder to be put into production as demand increases. The facility can cope with Micron's test and assembly needs in Asia for the next four to five years, according to the company's media statement.

In two years, the chip maker also expects to increase its Singapore headcount from 3,000 to 3,500 employees, said Jen Kwong Hwa, managing director of Micron Semiconductor Asia.

Responding to concerns that the semiconductor industry might be slowing down this year due to rising oil prices, Appleton said 'the impact has not been noticed".

Although demand may be dampened by high oil prices even as the company moves into its usually strong holiday season, the CEO pointed out that products such as CMOS (complementary metal oxide semiconductor) image sensors would continue to do well.

"There might not be higher growth, but growth will still be pretty good because the penetration rate of the (CMOS) technology in cellphones is remarkable," he said.

Appleton declined to comment on the possibility that chip giant Intel might work with Micron to develop NAND flash memory chips used in cellphones.

NAND flash memory is touted as the next growth area for chipmakers as the demand for rival NOR-based memory declines. According to research firm iSuppli, NAND flash memory modules contributed 55 percent of total worldwide flash-memory revenue in the second quarter of 2005.

"I can't say with certainty what kinds of products we'll develop together when we move forward, but we do expect to have a continuing relationship in bringing new products into the market," Appleton said.

A shareholder of Micron, Intel is rumored to be interested in entering the NAND flash memory market by partnering with the company, according to media reports in the United States.