The confidence of a significant price reduction
Texas Instruments has the confidence to significantly reduce prices, mainly reflected in two aspects: firstly, the IDM model; The second is the large-scale construction of 12 inch wafer factories.http://www.ic-bom.com/
According to the vertical and horizontal analysis of the semiconductor industry, IDM has many advantages in the analog
chip market. Unlike digital logic chips (memory, processors, etc.), analog chips are more complex from design to manufacturing, making it difficult to form standards. The correlation between design and production line is high, which makes analog chips particularly suitable for IDM mode. This mode allows for higher efficiency and controllable costs in converting design into production line products, especially for TI, which has the largest variety and quantity of analog chip products in the world, It can further reduce costs.http://www.ic-bom.com/
Secondly, TI has been expanding its 12 inch wafer factory for many years, reducing the proportion of 8-inch wafer production lines.
In the coming years, TI will build four new 12 inch wafer factories in Sherman, Texas, with two starting construction in 2022 and achieving mass production in 2025, while the other two are still under planning. Prior to this, TI had built multiple 12 inch factories in the state, including DMOS6 and RFAB1 in Dallas, and RFAB2 in Richardson, which was put into mass production in September 2022.
In addition to Texas, TI also has a 12 inch wafer factory LFAB in Lehi, Utah. The factory was acquired by TI from Micron in October 2021 and has been transformed into mass production in December 2022, capable of producing analog and embedded chips based on 65nm and 45nm processes.http://www.ic-bom.com/
As a simulation chip manufacturer, it is rare to build so many 12 inch wafer factories. The main purpose of TI‘s approach is to improve production line efficiency and reduce individual chip costs.
Traditionally, analog chips are mostly produced on 8-inch wafers, or even 6-inch wafers. However, with the development of market applications and demand, as well as intensified competition, analog chip manufacturers, especially those with high industry rankings and strong capabilities, have begun to use 12 inch wafer production lines to produce analog chips. The main purpose of this is to improve production efficiency and reduce individual chip costs, Because a 12 inch wafer can produce more chip products than an 8 inch wafer.
A typical enterprise doing this is TI, whose comprehensive cost of 12 inch wafers is 35-40% lower than that of 8 inches (including depreciation). Famous manufacturers such as ADI are also doing similar work, but their investment and scale are not as large as TI‘s.
In recent years, after existing and newly built 12 inch wafer factories have been put into operation, TI‘s analog chip production has further increased and production efficiency is higher, which to some extent provides more room for TI products to reduce prices.
