Siltronic ends wafer production for "small diameters"

Siltronic currently produces wafers with a diameter of 300 mm, and 200 mm and wafers with smaller diameters of up to 150 mm. The smaller diameter (SD) wafer technology was developed primarily in the 1990s and earlier. The most significant technological breakthroughs in recent decades have been achieved with larger diameters, which also show the highest growth potential. An average volume growth of 6% per year is expected for 300 mm wafers.

"SD wafer production at Siltronic originated in Burghausen in 1968. It has contributed to our success for many years, thanks to the outstanding work of our employees. However, the wafer industry has evolved significantly due to structural changes and innovations. Demand has increasingly shifted to wafers with larger diameters and improved properties, while SD wafers are approaching the end of their life cycle. This has led to a notable decline in volumes, which recently had a negative impact on earnings," says Dr. Michael Heckmeier, CEO of Siltronic AG in a press release.

The CEO continues to state that as this will likely continue to intensify in the coming years, and that the company has decided to gradually reduce the production of small diameters and to cease it in 2025.

"Despite this decision the Burghausen site remains of crucial importance for Siltronic. Our global technology as well as research and development center, the production of 300 mm wafers and 200 mm hyperpure silicon ingots as well as a large part of our administrative functions are located here," Michael Heckmeier says.

Just 25 years ago, more than half of the silicon wafer market consisted of wafers with a diameter of up to 150 mm. Today, it is less than 5%, based on data published by the industry organisation SEMI. This is the result of customers reducing or ceasing their production of small wafers due to the dynamic technological developments in the semiconductor industry. In addition, competition, particularly from China, is now clearly felt in the small diameters.

In the past financial year, SD wafers accounted for a single-digit percentage of the group’s sales. The impact on earnings has already been clearly negative in recent months. Approximately 400 people are employed in the small diameters, about half of whom are on fixed-term and temporary contracts. The company says that the aim is to reduce the core workforce in a socially responsible manner through demographic change and partial retirement, and to avoid layoffs for operational reasons.