Dynex walks the line with foundry deal

January 11, 2018 // By Nick Flaherty
It is accepted wisdom in the electronics business that you don’t compete with your customer. That has been particularly true in the semiconductor business and foundries, and sparked the growth of the ‘pure play’ foundries such as TSMC and Global Foundries that now dominate the industry. Their success has come from a focus on the process technology and offering that to a wide range of customers. What they don’t do is make their own products.

That makes the announcement of Dynex in offering a foundry service as worrying. The company already makes a range of IGBT power devices, and now has a deal to supply a ‘leading semiconductor

That means that there is spare space in the fab, and that is not a good sign at the peak of the semiconductor cycle. Again the established wisdom is to fill up the fab with your own products. So does this mean Dynex is struggling to be successful? Although it hasn’t been hugely profitable in the last couple of years and revenues have fallen (from $46m to $40m, although the exchange rate hasn’t helped), it has grown at the site from 351 to 368 people in the first nine months of 2017.  

Now the power business tends to do things its own way. The fabs are smaller than their CMOS cousins and are fully paid for and running specialised processes that are optimised to particular types of devices. You can’t run standard CMOS in these fabs, and you can only run a limited number of different styles of power device without some hefty, and expensive, process development. All this limits the options for foundry customers to differentiate their devices from those of Dynex.

Dynex is a Canadian company with a fab in Lincoln, UK, that carries 59 years of British heritage through Marconi MEDL and GEC Plessey Semiconductors. Since 2008 Dynex has been part of a Chinese conglomerate.

That conglomerate, Shanghai-based CRRC Times Electric, is the key.

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