Chips In China

An infrastructure for domestic production is under construction. This is just the beginning.

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The Chinese semiconductor industry is undergoing radical change. The national imperative is to increase self-sufficiency in semiconductors dramatically in the next few years, because while China is the world’s fastest-growing semiconductor market, it currently must import about 80 percent of the chips used in equipment manufactured by Chinese OEMs.

Chengdu, the capital of Sichuan province in southwestern China, is working with GlobalFoundries through a joint venture that was set up to take advantage of China’s move toward self-sufficiency. It’s an opportunity for the municipality to turn itself into the Silicon Valley of the budding Chinese semiconductor industry.

While tourists may be familiar with the ancient city for its giant Pandas, spicy foods, cultural heritage and natural appeal, from a business perspective it is a thoroughly modern, cosmopolitan city with world-class infrastructure, a business-friendly attitude and a large, technology-savvy workforce. Many foreign multinational companies are located there, such as Intel, Texas Instruments and Siemens, along with large Asian enterprises such as Foxconn, which builds about two-thirds of the world’s iPads there.

Accordingly, Chengdu is providing attractive financial, educational and other incentives to prospective industrial partners, with the goal of developing an entire chip design and manufacturing ecosystem to serve the Chinese market.

That presented GF with an incredible ground-floor opportunity, not only to manufacture the chips required by the country’s electronics manufacturers, but also to play a key role in supporting the developing Chinese semiconductor industry as a trusted partner with uniquely advantageous, world-class technical resources.

Thus, we chose to build our fab in Chengdu despite strong interest from other cities. Fab 11 will be the largest and one of the most advanced 300mm fabs in China upon completion next year, and will be the center of our 22FDX production for that market.

Initially we will produce 130nm-180nm mainstream technologies there, with a capacity of 20,000 wafer starts per month (wspm). Then, in the latter part of 2019, we will begin volume production of our highly differentiated 22FDX (FD-SOI) technology, with an anticipated capacity of 65,000 wspm. Ultimately some 3,500 employees will be involved in Fab 11 operations.

Fab 11 adds to the resources we already have in China. We started with a sales office in Shanghai several years ago, where there are now 50 people in various roles including field application engineers, sales, marketing and other technical support functions.


Fab 11 construction.

But as a result of the IBM Microelectronics acquisition, we now also can offer a highly differentiated portfolio of RF technologies and a very large ASIC design/development team, with about 150 people in Shanghai and another 40-50 in Beijing. As our ASIC business continues to grow, so too will these numbers. This ASIC offering is a very powerful one, with one of the industry’s broadest ranges of ASIC design services, differentiated intellectual property (IP), custom silicon and advanced packaging for true end-to-end solutions.

Building a 22FDX Ecosystem, Leveraging ASIC Capabilities

The Chengdu government rightly sees our 22FDX technology as a key advantage in its efforts to become a center of gravity for the growing Chinese chip industry, and our presence as a magnet that will attract even more technology companies and make the city an international center of excellence for semiconductors.

That’s because 22FDX, with its unique combination of performance, RF capabilities, power, size and cost, is a perfect match for the end-markets on which China is focusing – battery-powered, wireless computing devices for mobile, Internet of Things (IoT), driver assistance/autonomous driving and 5G applications.

Beyond the fab, and along with our joint venture partner, we are helping to develop an entire 22FDX-based ecosystem comprising IP, EDA and design services companies, who will be our customers and partners going forward. This ecosystem will play a critical role in the eventual launch of 22FDX technology in China because these companies will already know how to work with it and will be familiar with its benefits as they design innovative electronic products.

For example, there are more than 700 fabless semiconductor companies in China, and that number is growing fast. While some are more technically advanced than others, on an overall basis there is a strong need for expert help and technical assistance. Our in-country ASIC engineers are already working on-site with some of these companies on 22FDX projects which means, in effect, that we’re already open for business in that technology even though Fab 11 itself is still under construction.

Throughout greater China, our existing customers range from Tier One companies to many of these smaller companies, but as we bring on more capabilities and technologies such as 22FDX, opportunities are opening up with customers we weren’t able to serve previously.

It’s Just the Beginning
The Chinese semiconductor industry is really only in its infancy. More than 10 fabs are now under construction throughout the country, including ours, and an entire industrial infrastructure is being established.

Seen in that light, our new fab is not simply a manufacturing facility, but rather is a tangible symbol of a bright future for us in China.



1 comments

Dev Gupta says:

Technology transfer from the US to China in the hope of cutting costs or getting a share of the mythical Chinese pie has been a one way street and frequently saps the lifeblood out of the US co.s, as was found out to their dismay by Motorola and now GE. The state of NY gave GloFo a lot of subsidies. What is the guarantee that jobs and revenue from GloFo Malta Fab will not migrate to Chengdu along with FD SOI or that GloFo will still remain a Trusted Foundry for US users ?

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