NXP's THAI IC plant turned into Asia Hub

"We're expanding," Theo Halders, vice president of NXP Manufacturing (Thailand), said yesterday.

After the parent company revealed its restructuring policy last September, the plant has brought in high-level equipment as well as transferred equipment from its wafer fabs in the US and EU, Halders said during his presentation on the Bangkok manufacturing site.

NXP Semiconductors - formerly a division of Philips and still 20-per-cent owned by Philips - provides engineers and designers with semiconductors, system solutions and software.

It serves four major markets - home such as TV processors; automotive such as car entertainment, ABS sensors, and power, logic and networking; multimarket semiconductors such as high performance analogue, sound solutions, and ARM microcontrollers; and identification.

About 50 per cent of the Bangkok site's total output is ICs, while up to 35 per cent is chips for the auto industry and the remaining 15 per cent is chips for identification. It employs about 3,000 people, of whom 350 are engineers.

"We've invested about US$300 million (Bt10.2 billion) in Bangkok manufacturing or $10 million to $15 million a year since it was established in 1974," Halders said.

NXP Thailand is strong in the auto market, he said.

Though the semiconductor industry was hardest hit in the fourth quarter last year and the first quarter this year, making for a drop of 60-70 per cent on year, he believes it should recover overall during this year.

"Demand for chips in the auto industry is coming back. The second and third quarters are quite good as auto firms start producing again. But we don't know about the last quarter. However, it would be good, roughly saying that it should be better than last year," he said.

As suppliers, semiconductor-makers would experience a faster drop than the auto industry.

"Once the auto industry stopped producing, marking a drop in global car sales of around 20 per cent on year, the semiconductor industry's business dropped up to 70 per cent. On the other hand, when they start producing, we're going faster," he said.

According to several auto reviews, the auto outlook for this year was an expected drop of 15-20 per cent from last year and for next year was a recovery, but to the same level as last year, he said.

The Bangkok assembly site is running at 80-90 per cent, churning out 20 million ICs a day.