The supply of handset-use power management ICs remains severely tight, prompting the chip suppliers to transition to 12-inch wafer manufacturing, according to industry sources.
PWM IC suppliers contract mainly 8-inch foundries to manufacture their chips, but have seen their supply constrained by the extremely-tight 8-inch fab capacities, said the sources. The supply of 8-inch fab equipment has been relatively low when compared to that of 12-inch fab equipment.
Foundries also intend to encourage their PWM IC clients to switch to 12-inch wafer fabrication amid 8-inch fab tool shortages, the sources indicated. Foundries looking to expand 8-inch fab capacities usually source related equipment and facilities from the secondhand market, or existing fabs that are put on sale, as major fab toolmakers have already shifted their focus to 12-inch fab equipment.
Nevertheless, as the manufacture of power ICs requires BCD (bipolar-CMOS-DMOS) technology, foundries will have to build an additional 12-inch BCD process manufacturing capacity to satisfy an anticipated boom in demand for handset-use PWM ICs, the sources said.
PWM IC shortages could disrupt mobile SoC providers' shipments, the sources noted. Some vendors such as Qualcomm and MediaTek have already discontinued their bundle sale strategies, leaving downstream device manufacturers to deal with uneven inventories across different chip types, the sources said.
While coping with tight foundry capacity, PWM IC companies are also striving to improve their product mix for profitability as they find it increasingly difficult to raise again their chip prices, according to the sources.
