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TSMC ventures into automotive silicon market

Posted: 20 May 2008 ?? ?Print Version ?Bookmark and Share

Keywords:automotive market? foundry service? consumer electronics?

Foundry giant Taiwan Semiconductor Manufacturing Co. Ltd is in European talks to enter the safety-critical automotive silicon market. Infineon Technologies AG, which claims to be number two in automotive silicon, is one way TSMC could make its move.

Typically IDMs, while prepared to outsource digital CMOS requirements to foundries, have kept specialized processes proprietary, and when offering chips made on such processes for safety-critical applications carmakers have valued the strict traceability and guaranteed long-term supply.

As a result the automotive market has divided into three areas. The 'brown' goods that have entered the cabin in the form of infotainment have largely stayed as consumer electronics grade products. The automotive electronics of non-critical systems, such as smart power for window movement, have been open to outsourcing, while the key safety-critical systems such as engine-management and automatic braking systems have required the higher specification of 'zero-defect' manufacturing.

Platform focus
Maria Marced, president of TSMC Europe BV, who was attending a two-day conference organized by the Institute of Engineering and Technology and the Global Semiconductor Alliance, said the foundry was increasingly focused on "platform" offerings created with the relevant specifications and required intellectual property for different applicationsincluding automotive.

"It's a design platform," Marced emphasized saying that the real deliverable from TSMC is silicon, but acknowledging that enhanced specifications, processor IP, logic and I/O blocks and firmware could all be part of the enabling offering.

"Europe is a center of excellence for mixed-signal and communications and automotive are driving the market. We want to capitalize on that," Marced said. "We don't have automotive-grade, zero-defects. We have discussions going on."

TSMC recently announced that it had divided the company into two profit and loss centers; advanced manufacturing and mainstream manufacturing.

The mainstream manufacturing unit is where TSMC expects to work behind the leading edge to convert its older wafer fabs to create more application-specific processes that could include power and MEMS, Marced said.

Marced said she expected TSMC to enter the automotive market the way that the company had entered the digital CMOS market; by taking in an IDM's proprietary process and outsourcing for them, before going on to offer generic automotive processes to a broader customer base.

"We are now engaging with IDMs on mainstream technology. It is not only at the advanced nodes where they can't afford the capital expenditure," Marced said. "Zero defects is not a process. It is a methodology. It is specific to automotive. It is something we are interested in. It is in discussion in Europe but it is too early to say anything."

Eric Mayer, VP of production and partner management at Infineon, speaking at the IET/GSA conference, said, "The automotive industry is undergoing change. A 25-year life for car models [in manufacture] is coming down to five years. Wherever life is at stake in the car you have to have zero-defects."

When asked if such zero-defect manufacture could move to foundries, Mayer said, "Some carmakers want full control in-house at the IDM. It was one of the reasons Infineon built a fab in Kulim [Malaysia]; an 8-inch power fab."

But Mayer also said, "The big three foundries now have a reputation. They ring some bells. TSMC; if they want to do automotive, they can."

Freescale, which has an automotive design partnership with STMicroelectronics NV, claims to be the leading supplier of silicon to the automotive market. When asked if TSMC could enter the zero-defect automotive silicon market Steve Wainwright, VP sales and marketing and general manager for EMEA, for Freescale Semiconductor SA, said, "TSMC is already in the automotive market. We are using them for some of our outsourcing. Does that mean Freescale is going to go fabless, no it doesn't."

Earlier in his talk Mayer had made the point about the importance of supplier reputation and longevity. He referred to a carmaker that had required that a chip supplier be prepared to stock a designed-in chip for 50 years. "It was a British carmaker," Mayer said. While the semiconductor divisions of Siemens AG and Motorola Inc. may have transformed into Infineon and Freescale, respectively, the British car industry has largely disappeared.

Today's carmakers, increasingly working in India and China and often based there, are bound to ask themselves which companies are likely to be around in ten years time; TSMC or Infineon, or Freescale?

- Peter Clarke
EE Times Europe

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