Faced with customers dealing with accrued inventory over the past two years and reducing orders, pure-play foundry Tower Semiconductor will apparently shut down for three weeks this year.
According to a report from Data Centre Dynamics, the Israeli-based foundry’s Newport Beach, California, factory will shut down between April 1-7, July 1-7 and October 7-13. The shutdown will impact about 700 employees, who will be in furlough if they do not have accrued time off.
According to market research firm TrendForce, the equipment at the Newport Beach facility will remain in a warm shutdown and power to unused areas of the plant will be turned off.
Recent reports said that Tower was seeking a $9 billion investment to establish a facility in India as well as expand its operations over the next decade to produce 80,000 wafers per month. It is unclear how these weeks of shutdown will impact these goals.
Recent history
In 2022, Intel Corp. announced it would acquire Tower for about $5.4 billion, however, about a year later, the company citing the inability to obtain regulatory approvals, ended that takeover bid.
However, both companies continued their relationship and Intel said it would provide 300 mm foundry services for Tower utilizing its Fab 11X manufacturing facility in Rio Rancho, New Mexico. Tower would invest up to $300 million to acquire and own equipment and other assets at the fab after Intel spent about $3.5 billion to expand its advanced semiconductor packaging technologies.
In February at Intel Foundry’s Direct Connect 2024, Intel said it is working on a new deal with Tower involving a 40 nanometer mature process node.
