Toshiba to build new semiconductor facility in Thailand

TOKYO, JAPAN: Toshiba Corp.will rebuild its semiconductor manufacturing operations in Thailand by relocating Toshiba Semiconductor Thailand Co., Ltd. (TST) to a new manufacturing facility. The move will position the company to meet future growth in demand and replace the factory inundated by the 2011 floods.

Established in 1990, TST carries out back-end processes–assembly and packaging–for small signal devices and photocouplers. Small signal devices control current and voltage in digital consumer products, a product segment that is expected to grow in coming years, with a primary focus on smart phones and tablets PCs. Photocouplers are used widely in industrial products, such as inverters, and are also expected to see strong demand growth.

The new facility will be located at the 304 Industrial Park, Prachinburi, which is approximately 140km northeast of Bangkok and will replace TST’s facilities at Bangkadi Industrial Park in Pathumthani, in the suburbs immediately north of Bangkok. The new site is at 15 to 20 meters above sea level and outside Thailand’s main drainage basins, with no major rivers, so it offers TST advantages in the viewpoint of business continuity planning (BCP). Construction of a two-story building will begin in July on a lot with an area of approximately 135,000 square meters, 1.4 times the size of the Bangkadi lot.

Construction of the state-of-the-art factory will allow TST and Toshiba Group to respond flexibly to market demand with facilities offering greater operating efficiency and higher productivity. The plant is scheduled for completion next spring and mass production is slated to start in the second quarter (April-June) of 2013.

The initial investment of the facility including the cost of the construction will be largely met by flood insurance settlements and is not expected to impact on the results of Toshiba’s semiconductor business. Future investment and production expansion will be flexibly determined in light of market trends and customer needs.

Last year’s flooding completely inundated TST’s manufacturing facilities, resulting in a forced suspension of operations. As TST made every effort to recover operations, Toshiba responded with a BCP based on transferring operations to its production facilities in Japan and Malaysia and making use of outsourcing.

Toshiba Group is promoting a revitalization of its discrete device business aimed at boosting efficiency and profitability. Measures deployed to date include transitioning to larger wafers and higher output in the front-end process, and accelerating the overseas transfer of the back-end process. Construction of the new TST facility will improve cost competitiveness in the back-end process, strengthen the bottom line and contribute to the overall strength of the discrete business unit.

Outline of new factory
Location: Prachinburi prefecture, Thailand
Site Area: Approx 135,000m2
Floor area: Approx 40,000m2
Groundbreaking: July 2012 (scheduled)
Building completion: Spring 2013 (scheduled)
Mass-production start: 2nd quarter, calendar year of 2013 (scheduled).