NXP to Close Four 8-Inch Fabs, Shift to 12-Inch Production

According to recent reports, NXP Semiconductors plans to shut down four of its 8-inch wafer fabs, including one facility in Nijmegen, the Netherlands, and three others located within the United States. Nijmegen serves as a critical site for NXP in the Netherlands, second only to its Eindhoven headquarters, encompassing manufacturing, research and development, testing, technology enablement, and support functions. This site plays a vital role in new product introduction processes.

This decision aligns with NXP's strategic shift to transition production towards newer 12-inch wafer fabs. A single 12-inch wafer yields 2.25 times more chips than an 8-inch wafer, enabling significantly lower fixed and manufacturing costs and resulting in improved profitability. As such, NXP aims to close these four 8-inch fabs within the next decade.

In addition, NXP's joint venture with Vanguard International Semiconductor Corporation (VIS) in Singapore is constructing a 12-inch wafer fab scheduled to begin mass production in 2027. This facility will focus on producing mixed-signal, power management, and analog chips ranging from 130nm to 40nm process nodes. It is expected to reach a monthly capacity of 55,000 wafers by 2029, becoming a key manufacturing hub for NXP in the Asia-Pacific region.

NXP's strategic realignment reflects a broader trend of semiconductor industry modernization worldwide. The explosive growth in AI and data center demands is accelerating the market’s shift toward more efficient and cost-effective manufacturing technologies. According to SEMI statistics, 82 new 12-inch chip fabs and production lines are expected to be established globally between 2023 and 2026. By 2026, 12-inch wafer capacity is projected to reach 9.6 million wafers per month.

Industry data further reveals that 12-inch wafers currently represent approximately 65% of total semiconductor silicon wafer shipments, while 8-inch wafers account for about 20%, with the remainder made up of smaller wafer sizes. Dr. Li Wei, Executive Vice President of Shanghai Silicon Industry Group, anticipates that 2024 could mark a pivotal turning point for the phase-out of 8-inch wafers, as outdated capacity and technologies are typically eliminated during industry transitions.

Analysts note that NXP's move to 12-inch wafer production results from the combined influence of technological evolution, market demand, and industry competition. Despite challenges such as high equipment costs and process complexity, NXP is progressively building a diverse capacity system that integrates both advanced and mature process technologies through partnerships and foundry collaborations. The company will continue to seek a balance among technological breakthroughs, cost management, and regional manufacturing layouts to maintain competitiveness.