Surge in LED demand prompts new chip fab plans

Even the most pessimistic of analyst paints a bright future for LED sales driven first by the TV backlight market and later by the continuing transition of the general illumination market to LEDs. The projected surge in demand is leading established players such as SemiLEDs to expand its manufacturing capacity and newcomers such as TSMC and De Core Nanosemiconductor to build their first LED chip fabs.

SemiLEDs had previously disclosed plans to build a fab in Foshan, located in the Guangdong province of China. The Boise, Idaho-based company will build both LED wafers and high-power LED chips in the facility. According to China Tech News, the new venture called Xurui Optoelectronics just laid the foundation for the plant. SemiLEDs is investing $350 million in the venture and owns a 49% stake with six other companies holding 51%.

TSMC just broke ground on its first LED fab in Hsinchu Science Park, Taiwan. TSMC is the leading contract IC fabricator and believes it can transfer its manufacturing expertise to LEDs. "LED lighting is a promising industry, and we will make full use of TSMC’s technology leadership and manufacturing excellence in semiconductors to develop and integrate LED technology, process, and packaging and testing,” said Dr. Rick Tsai, TSMC President of New Businesses. Volume production is scheduled for the first quarter of 2011.

De Core Nanosemiconductors, meanwhile, is a spinout of De Core Science and Technologies. De Core Science has focused on Aluminum Indium Gallium Nitride wide-band-gap materials. The LED chip venture will focus on crystal-based, nano-heterostructured white LEDs. De Core will spend approximately $200 million on the LED fab at Gandhinagar in Gujarat.

The India-based Daily News and Analysis web site reports De Core executive Deepak Loomba as proclaiming that the fab would be the first semiconductor fab in India. The company has also began production of LED lighting products at a plant in Noida and will ultimately use the LED fab to supply the lighting operation.

It appears almost certain that the industry can consume the increased output of these new fabs and more. For details on the expected demand for LEDs in the near and long term, check out these stories focused on projections from Strategies Unlimited, Canaccord Adams, and Gartner.

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