Opinion: Europe must back the Rousset Phoenix

Opinion: Europe must back the Rousset Phoenix

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Can European companies such as Bosch or STMicroelectronics be brought together with strategic investors to raise a phoenix from the ashes of a wafer fab in Rousset, France? And can the European Commission justify the tax euros that get passed to them by being effective in making this happen?
By eeNews Europe

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A recovery plan being put together for the wafer fab that was LFoundry Rousset SAS shows promise, but is late and lacks detail on sources of funding (see Plan to re-open Rousset fab requires investors).

Rousset needs financial backers and to excite them and bring them in, it needs technologists with vision and probably a "big brother" integrated device maker or foundry that will provide a manufacturer process technology as an investment in kind. Above all it needs European support – both political and commercial – because if Europe will not back its own manufacturing expertise, why should anyone else. And it needs the plan to come together fast.

Unfortunately for the last nine months the French government and European Commission have twiddled their thumbs to the point that Rousset is almost beyond recovery. They may well argue that it required the owners to come up with a proposal to which they could react, but both entities claim to be in favor of re-industrialization and what we are witnessing in Rousset is likely to be the opposite, unless this plan can be made to work.

I don’t want to pour cold water on the nascent plans to re-open the former Atmel and LFoundry wafer fab in Rousset, but time is running out. We are three months on from the declaration that the foundry business was bankrupt and must close. Some debtors will be calling for the equipment to be sold, the shell of the building stripped and the site sold. And the engineering expertise will be dissipating as workers make alternative employment arrangements, where they can.

For a site that was selling €100 million (about $140 million) of wafers each year, that would be a great shame. That is the cup half empty.

Of course if the assessment was that we were starting with a blank piece of paper to create a manufacturing entity then Rousset has clear advantages, a mothballed wafer fab and workforce with expertise and customer contacts gives it an advantage over other sites in Europe. That is the cup half full.


The plan as it stands does have promise but it does seem to depend on using the established LF150 and LF110 manufacturing processes. Given that LFoundry GmbH is one of the defendants in the lawsuit being brought in New York (see Conspiracy alleged over Rousset wafer fab closure), the rights to those processes might be challenged raising more fear uncertainty and doubt.

The plan does have technologists with vision – General Vision Inc. that is. The enthusiasm and involvement of Guy Paillet, CEO of General Vision, is a positive step. However, it would seem that any need that it has for its neural networking cognitive processing chips is relatively modest and could be met economically at any of many existing fabs.

Who will help a move to MEMS?

What the Rousset phoenix really needs is a strategic investor or sovereign wealth fund with a long-term perspective and a manufacturing technology provider. Perhaps STMicroelectroncs could provide MEMS processes to allow Rousset to specialize in this high growth market that is well suited to 200mm diameter wafers.

And there have been rumors that the sovereign wealth fund Taqnia of the Kingdom of Saudi Arabia has looked at the Rousset site, but with all such deals it is about putting the whole team together – money, technology, manufacturing expertise and customers.

However, there is no doubt that the lay offs at Rousset, and others expected to come at Micron Italy, have hit a nerve across Europe and in Brussels. While the European Commission has been campaigning for an "Airbus of Chips" initiative to boost European chip manufacturing to 20 percent of world supply in 2020 the leading players in Europe – Infineon, NXP and STMicroelectronics – are themselves pursuing fab-lite and Asia-centric business models. There is a risk that Europe is falling below a threshold of relevance in semiconductors.

It will be a test of the European Union’s and the European Commission’s effectiveness if it can be decisive and quick enough to help a phoenix rise out of the ashes in Rousset. At the same time we will find out if the Airbus of chips initiative has wings or is just hot air.

Related links and articles:

www.taqnia.com

www.pradallaw.com

www.general-vision.com

News articles:

Plan to re-open Rousset fab requires investors

Conspiracy alleged over Rousset wafer fab closure

Rousset closure unavoidable, says LFoundry

Opinion: Rousset and le temp perdu

 


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