Hon Hai Precision Industry (Foxconn) is expanding its semiconductor manufacturing capabilities specifically focused on the automotive industry with capacity expected to come online in 2023.
Taiwan-based Foxconn said its strategic goals have changed to focus on chips that will be used for future electric vehicles (EVs) and autonomous driving capable cars. The company will also focus on next generation networking chips, it recently said at a shareholders' meeting.
The move comes as the semiconductor industry is still dealing with an ongoing chip shortage that has impacted the entire supply chain and has hit the automotive market especially hard. For the past few years, the automotive market has had to realign its output of vehicles multiple times due to the chip shortage and cut revenue projections.
5% of the market
Foxconn’s goal is to hold about 5% of the EV market by 2025 with an annual 500,000 to 750,000 units. To meet these goals, Foxconn will be upping its capital expenditures for EV development in 2021 and 2022 to $500 million.
Mass production of Foxconn’s automotive 8 inch and 6 inch wafers will begin in 2023 with in-hour 6 inch silicon carbide (SiC) wafers also beginning production in 2023.
The SiC capacity will include on-board chargers, automotive microcontroller units, SiC power modules for optical phased array lidar and inverters. Foxconn said it will invest and develop a full range of medium and high voltage power components to mass produce automotive power management ICs (PMICs) by 2024.
Foxconn said it is working with Malaysian companies on a 12 inch fab, in addition to taking over wafer fabs from Macronix and Sharp that will be used for its automotive semiconductor manufacturing.
The capacity expansion by Foxconn is just one part of how the market is reacting to the chip shortage. Other automotive OEMs are solidifying deals with semiconductor foundries to secure capacity so if chip shortages happen again due to either future pandemics or geopolitical issues, they will still have a stable supply of semiconductors.
Globalfoundries has signed up BMW Group and Ford to build automotive chips for future vehicles including EVs and highly automated driving cars.
Denso, a Japanese automaker, earlier this year took a stake in Japan Advanced Semiconductor Manufacturing Inc (JASM), a subsidiary of Taiwan Semiconductor Manufacturing Co (TSMC). The deal will allow Denso to have a secure supply of automotive semiconductors for the medium and long term.