Semiconductor vendor Texas Instruments (TI) plans to invest $11 billion in a new 300 mm chip wafer fabrication in Lehi, Utah, in what is claimed to be the largest economic investment in Utah history.
The fab will be located next to the company’s existing 300 mm semiconductor wafer fab in Lehi (LFAB) and once completed, the two fabs will operate as a single fab, TI said. TI acquired the LFAB from Micron Technology in 2021 and paid $900 million for the facility.
The current Lehi fab features 65 nm and 45 nm production nodes for both analog and embedded processing semiconductors. The fab will move beyond these nodes if required, TI said.
The LFAB expansion will be in addition to the four 300 mm fabs TI already has planned for analog and embedded chips in Sherman, Texas.
Construction of the Lehi expansion is expected to begin in the second half of 2023 with production as early as 2026. When completed, the fab will manufacture tens of millions of analog and embedded processing chips daily.
Jobs and education
The expansion to the Lehi location will create about 800 additional TI jobs as well as thousands of indirect jobs. Additionally, TI will invest in the Utah educational infrastructure by working with the Alpine School District for a $9 million investment to improve student opportunities.
"This new fab is part of our long-term, 300-mm manufacturing roadmap to build the capacity our customers will need for decades to come," said Haviv Ilan, TI executive vice president and chief operating officer, and incoming president and chief executive officer. "Our decision to build a second fab in Lehi underscores our commitment to Utah and is a testament to the talented team there who will lay the groundwork for another important chapter in TI’s future.”
TI said Lehi is located near skilled talent and a robust existing infrastructure and will be designed to meet one of the Leadership in Energy and Environmental Design (LEED) building rating systems for efficiency and sustainability. This includes using recycled water at nearly double the rate of the existing Lehi fab.
Regionalization growth
Currently, only 12% of all semiconductor manufacturing is done in the U.S. If the situation does not change, it will decline to 10% in the coming decade, according to the Semiconductor Industry Association (SIA). In 2021, 54% of semiconductors were produced by American companies.
The growth in regionalization in semiconductor manufacturing has become a priority for many countries after COVID-19 exposed flaws in the aggregation of the current supply chain residing only in Asia.
When lockdowns in the supply chain caused a massive chip shortage that lasted more than two years, governments, trade organizations and domestic companies lobbied for more fabs regionally. This included the passing of the CHIPS and Science Act, which is designed to inject $52 billion worth of incentives and tax breaks for companies looking to build new fabs in the U.S.
The CHIPS Act is set to position American manufacturing into advanced 5 nm and 3 nm transistor process technologies, an area the country lags Japan, Taiwan and South Korea.
Flurry of activity
The hope is that chipmakers will be wooed into building new sites in America so when another pandemic happens, or a geopolitical issue, or a raw materials shortage, the supply chain will be more resilient.
This has caused a flurry of activity in semiconductor manufacturing in the U.S. including:
- Intel building two new fabs in Ohio.
- TSMC building two fabs in Arizona.
- Samsung building a fab in Tyler, Texas.
- Micron building a new memory fab in Idaho.
- GlobalFoundries is set to build a new facility in Malta, New York.
