NEC Aims for Top Auto Spot.

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NEC Electronics Corp. has set its target on the number one supplier position in automotive MCUs, today saying it will streamline manufacturing and enhance quality control functions through a combination of plant changes and layoffs.

Specifically, the company's goal is to achieve a 20 percent market share, or approximately $1.18 billion (140 billion yen) in sales of automotive MCUs, by 2010.

As part of its plan, NEC Electronics America's manufacturing facility in Roseville, Calif., will be outfitted with equipment for 8-inch wafer fabrication using 0.15-micron process technologies for the production of automotive MCUs. A pilot line will be established by September and volume production will be steadily ramped up with the goal of surpassing 6,000 wafers per month by 2008, NEC said.

The Roseville plant currently produces 0.35- and 0.25-micron devices on 6-inch wafers, which are primarily shipped to automotive customers in the Americas and Europe. NEC Electronics also produces automotive MCUs at its facility in Kumamoto, Japan, but to keep pace with the increase in global customer demand for 0.15-micron devices, the company said it decided to establish the new line in Roseville.

Equipment for the new 8-inch line will be transferred from NEC Electronics' existing production facility in Sagamihara, Japan, to the NEC Electronics America plant in Roseville. Meanwhile, the 8-inch line at Sagamihara will be discontinued to lower operating costs.

Further, NEC Electronics will concentrate its test and assembly services for American and European automotive MCU customers at NEC Semiconductors Singapore. Production capacity at the Singapore facility will increase 65 percent, reaching 10 million units per month, the company said.

NEC Electronics currently operates a test and assembly facility at NEC Semiconductors Ireland, as well, but due to high operating costs, the company plans to end production and lay off the approximately 350 employees there by September. The majority of the equipment used in Ireland will be transferred to Singapore.

NEC Electronics' plan will also see some shifting here in the United States. NEC Electronics America's Dallas design center, which formerly conducted development of ASICs, has been restructured to focus on the design and development of automotive MCUs.

NEC Electronics Europe will also strengthen its design resources at the European Technology Center in Duesseldorf, Germany, dedicated to the development of automotive MCUs. In April, a new European quality center will be established at NEC Electronics Europe's headquarters in Duesseldorf, which will merge the quality assurance activities currently conducted there with quality management efforts at NEC Semiconductors Ireland.