UMC shutters Japan fab
UMC has closed down its Japan-based fab citing both uncertain demand and the uncertainty of the electricity supply. It will swirtch its Japan production to Taiwan and Singapore.
UMC picked up its Japanese fab in 1998 when it took a 56% stake in the semiconductor subsidiary of Nippon Steel. In the 1980s it had become fahionable in Japan for steel companies to set up semiconductor subsidiaries. As well as Nippon Steel, Kawasaki Steel, NKK and Kobe Steel also set up semiconductor companies and built fabs which were used as foundries.
In 2009 UMC bought out the 44% of Nippon Steel which it didn’t own.
UMC Japan lost $20m in the first half on sales of $45m.
UMC has also stopped further investment in the solar cell industry because of the state of the market. It got into the business three years ago, in 2009, by investing $46m in various solar operations. One of these was a 44% stake in thin film solar photovoltaic producer NexPower Technology.
The whole industry has over-invested, capacity far exceeds demand, and many of the companies are saddled with heavy debts.