Power management ICs may shift to 12-inch wafer manufacturing

According to industry sources, the supply of power management ICs for mobile phones remains severely tight, prompting chip suppliers to turn to 12-inch wafer manufacturing.

Digitimes reported that sources said that PWM IC suppliers mainly contract with 8-inch foundries to manufacture their chips, but the extremely tight 8-inch wafer fab capacity limits product supply. Compared with 12-inch wafer fab equipment, the supply of 8-inch wafer fab equipment is relatively low.

Sources said foundries also intend to encourage their PWM IC customers to switch to 12-inch wafer manufacturing amid an extreme shortage of 8-inch capacity.

It is understood that as major wafer fab tool manufacturers have shifted their focus to 12-inch wafer fab equipment, foundries seeking to expand 8-inch wafer fab capacity usually purchase related equipment and facilities from the second-hand market or from existing wafer fabs that are sold.

"However, since the manufacturing of power ICs requires BCD (bipolar CMOS-DMOS) technology, foundries will have to build additional 12-inch BCD process manufacturing capabilities to meet the expected demand for mobile phone PWM chips," the source added.

Meanwhile, the PWM IC shortage could disrupt shipments of mobile SoC suppliers. The source further pointed out that suppliers such as Qualcomm and MediaTek have stopped bundling sales strategies, leaving downstream device manufacturers to deal with inventory imbalances of different chip types.

Separately, sources said that while coping with tight foundry capacity, PWM IC companies are also working to improve their product mix to boost profitability as they find it increasingly difficult to raise chip prices again.