Chipmakers Repurpose Old LCD Fabs
To meet soaring demand for AI hardware, chipmakers are reclaiming decommissioned LCD fabrication plants to secure scarce cleanroom capacity for wafer production. Samsung's foundry business is reportedly leveraging its leadership in memory chips to win new orders from major tech companies in this "cleanroom gold rush."
- Repurposing existing facilities is a key strategy for producing chips on mature process nodes (28nm and larger), which are still essential for applications like telecommunications, automotive, and the Internet of Things. This approach avoids the staggering $15-20 billion cost and lengthy construction timelines of new leading-edge fabs. - Converting an LCD cleanroom is faster than building a new semiconductor fab from the ground up, which can take over two years. Former LCD plants provide the crucial cleanroom infrastructure, which is one of the most expensive and time-consuming parts of fab construction. - The cleanroom standards for LCD manufacturing are similar to those required for semiconductor production, often classified under ISO 14644, which specifies the maximum allowable particle count per cubic meter of air. However, semiconductor fabs have more stringent requirements for controlling airborne molecular contamination (AMC), which is addressed by separate SEMI standards. - This trend is global, with companies like TSMC, Micron, and SK Hynix showing interest in acquiring older LCD factories from panel makers such as AUO, Innolux, and LG Display. Intel is also reportedly planning to use a Sharp LCD factory in Japan for semiconductor backend process development. - The demand for mature node semiconductors is projected to have billions in unmet demand annually. Chinese foundries are expected to lead the expansion of mature process capacity in 2025, driven by domestic IC substitution policies. - Samsung's conversion of its Cheonan LCD plant is a notable example. The facility, which was costly to maintain while idle, offers a ready-made site that bypasses the complex approval processes required for new construction. The company has also been converting other LCD lines, like its A4-2 line, to OLED production.
