Diversity in size, application and geography typify new cleanroom construction market-Part 1
By Robert McIlvaine and Betty Tessien of The McIlvaine Company
Cleanrooms are utilized by semiconductor, pharmaceutical, flat panel display, aerospace, food and other manufacturers who need to protect products and/or workers from airborne contaminants. According to our research, more than 94 million square feet of cleanrooms are installed worldwide with more than 150,000 cleanrooms, ranging from less than 100 square feet to over 300,000 square feet, in use. More than 8,000 new cleanrooms will be built this year, of which the largest 800 will account for more than 80 percent of the total new space. These larger projects are tracked in the McIlvaine publication World Cleanroom Projects. This month’s column will report on the worldwide cleanroom market for the flat panel display and semiconductor sector. Next month, the pharmaceutical and biotechnology sectors will be examined.
Cleanrooms are classed by cleanliness, and the cost of the space is directly related to class level. For example, an ultraclean ISO Class 3 (Class 1) room used for semiconductor production will cost more than $700/ft2 and a typical wafer fabrication facility of 40,000 square feet will invest $28 million for cleanroom hardware. On the other hand, the lowest cleanliness ISO Class 8 (Class 100,000) space requires an investment of only $85/ft2 with the average size room of 700 square feet requiring an investment of $60,000.
Though the U.S. still leads in the number of active cleanroom construction projects, the gap is narrowing. China is gaining ground and will likely soon overtake the U.S. in terms of number of projects. One contributing factor is that China is becoming a center for disk drive manufacturing at the expense of Singapore, Thailand, and Malaysia.
With its huge demand for chips, China is also rapidly building semiconductor plants to fill the local demand. Even in the pharmaceutical sector, currently dominated by the U.S., China is investing heavily in new facilities.
In Japan, more new projects are now underway than at anytime in the last 10 years, but, nevertheless, much of its electronics production has been lost to Taiwan and South Korea. The number of Indian projects is accelerating at double-digit annual rates.
Flat panel displays
In terms of size, the largest cleanroom projects are found in the fast-growing flat panel display (FPD) industry, where cleanrooms with up to 300,000 square feet of space are needed for the high-volume production of these very large products. Global combined sales of liquid crystal display (LCD) and plasma TVs are forecast to quadruple to 100 million units by 2009. As a result, manufacturers are adding substantial cleanroom capacity.
Matsushita Electric Industrial Co., the largest FPD manufacturer with about one-third of the market, will spend 180 billion yen ($1.54 billion) on the world’s largest plasma display factory, more than doubling its production capacity by 2009. Hitachi is likewise accelerating an expansion project at its plasma factory. Sharp, meanwhile, has upgraded its facility in Mie Prefecture, Kameyama, Japan, to manufacture eighth-generation (8G) panels, with the ability to cut six 47-inch panels. The company is spending $1.6 billion on its facilities this year including the Kameyana plant, which aims to begin production before October 2006.
S-LCD plans an expansion of its seventh-generation (7G) amorphous TFT production facility to help meet the demand for television LCD panels. Currently, production capacity is 60,000 panels per month but the company expects to increase this by 15,000 panels per month by July 2006. S-LCD will support the LCD TV business of both Samsung and Sony. The company also plans to spend about $2 billion on a new plant to manufacture eighth-generation LCD panels, using substrates roughly measuring 2.2 by 2.5 meters. The new plant is slated to start mass production before the end of 2007.
Chi Mei Optoelectronics (CMO) is planning to set up three new panel plants this year, including a 6G facility and two 8G TFT-LCD panel facilities in Kaohsiung Science Park. Each 8G plant costs over $3.08 billion and construction is now underway.
Meanwhile, L.G. Philips plans to build the world’s biggest LCD factory in Kyonggi Province, South Korea. The plant, “P7,” will produce large seventh-generation LCD panels. Under an agreement with the Kyonggi provincial government, L.G. Philips LCD will do the preparatory work for the facility. The 1.65-million-square-meter complex is located in the agricultural city of Paju, Kyonggi Province, north of Seoul. The newly expanded Paju plant will begin commercial production before the end of 2006. L.G. Philips will work with the provincial government to complete infrastructure, such as industrial water systems, electricity utilities and roads. The L.G. Philips LCD 3.3-million-sqare-meter industrial cluster will house next-generation LCD production and R&D facilities, leading the future of the Korean display industry.
Corning will spend $174 million to expand its eighth-generation LCD glass substrate manufacturing capacity at its facility in Shizuoka, Japan. Corning has also constructed a facility in Taichung, Taiwan, and is planning a facility in Beijing, China.
Samsung will invest $54 million for amorphous silicon-based white OLEDs at its fifth-generation TFT-LCD production line in Cheonan, South Korea. Chunghwa Picture Tubes is building a seventh-generation panel production plant at a cost of about $6 billion.
In Europe, Sharp is negotiating with the government of Poland to construct a manufacturing facility for LCD modules in the city of Torun. Initial investment will be 44 million euro with an initial workforce of 800 employees. The objective is to meet the needs of the LCD-TV market in Europe, which is predicted to undergo extremely rapid growth. The facility will begin production of LCD modules in January 2007 for large-screen LCD-TVs to be manufactured by Sharp Electronica in Spain and Loewe Opta in Germany.
The semiconductor industry is also constructing large-sized cleanrooms for chip production. Toshiba and SanDisk have announced that they will build a Fab 4, with construction to begin in August 2006. Construction is expected to last approximately a year with the first tools being set up before the end of 2007. The total capacity of Fab 4 will be similar to that of Fab 3, which was put at 62,500 wafer starts per month with 371,220 square feet of cleanroom space.
Samsung Electronics plans to invest $220 million in its second semiconductor facility in Austin, Texas. The move will add 900 people to the company’s workforce there. The new facility is getting a $10.8 million grant from the Texas Enterprise fund together with $58 million in tax rebates from the city of Austin for an incentive package totaling over $200 million. Samsung previously began a $500 million upgrade and expansion of the Austin plant in 2003.
Japanese electronics maker Toshiba Corp. has unveiled a plan to invest 2.04 trillion yen ($18 billion) over three years to boost output of its computer chips and other products. Under the plan, Toshiba will construct new production lines of flash memory chips at its plant in Yokkaichi, western Japan. The company is also considering building another semiconductor plant.
Semiconductor Manufacturing International Corp. (SMIC), the third largest pure-play foundry by revenues, is currently constructing a second dedicated 300 mm fab located at its cluster of 200 mm facilities in Shanghai, China. The facility is expected to be completed by the end of 2006 with tool-install expected in Q1 2007.
Currently SMIC operates one 300 mm facility in Beijing-the first 300 mm facility in operation in China. The foundry expects to spend $1.1 billion on capital expenditure in 2006 with an estimated $200 million allocated to construction and cleanroom installation at the new fab in Shanghai.
Regulators of Vietnam’s Ministry of Investment and Planning have approved a license application from Intel to invest $300 million to $605 million to build a back-end chip assembly plant in Ho Chi Minh City. The plant is expected to be the largest technology project in Vietnam and eventually employ 1,200 people. The facility will be the first semiconductor back-end plant in Vietnam. Intel’s sixth plant in Asia, it will be used for wafer dicing, packaging, testing and shipping.
Robert McIlvaine is president and founder of the McIlvaine Company in Northfield, IL. The company first published Cleanrooms: World Markets in 1984 and has since continued to publish market and technical information for the cleanroom industry.
Betty Tessien is the cleanroom publications editor for the McIlvaine Company.