Microchip Technology (MCHP)

[Democritus_of_Abdera]

MCHP Manufacturing Facilities...

One consequence of Japan's current misfortune may be unreliable or sporatic electrical supply to its semiconductor fabrication facilities. I gather from the news that wafer fabrication would be severely compromised if there are unplanned and intermittent power outages.

I wonder if MCHP depends upon Japanese sources in any meaningful way. My interpretation of MCHP's most recent 10 K (June 2, 2010) is that MCHP might not be directly affected (except, possibly, for some wafer assembly and testing). i.e.:

Our manufacturing operations include wafer fabrication and assembly and test. The ownership of our manufacturing resources is an important component of our business strategy, enabling us to maintain a high level of manufacturing control resulting in us being one of the lowest cost producers in the embedded control industry. By owning our wafer fabrication facilities and our assembly and test operations, and by employing statistical techniques (statistical process control, designed experiments and wafer level monitoring), we have been able to achieve and maintain high production yields. Direct control over manufacturing resources allows us to shorten our design and production cycles. This control also allows us to capture the wafer manufacturing and a portion of the assembly and testing profit margin.

Our manufacturing facilities are located in:

• Tempe, Arizona (Fab 2)
• Chandler, Arizona (probe operations)
• Gresham, Oregon (Fab 4)
• Bangkok, Thailand (assembly, probe and test)
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We perform product assembly and testing at our facilities located near Bangkok, Thailand. As of March 31, 2010, approximately 65% of our assembly requirements were being performed in our Thailand facility. As of March 31, 2010, our Thailand facility was testing substantially all of our wafer production. We use third-party assembly and test contractors in several Asian countries for the balance of our assembly and test requirements.