Chinese chip factory: SMIC plans $ 9 billion new build for 28 nm and larger


SMIC wants to be better equipped against TSMC and is planning a 9 billion US dollar factory building near Shanghai. The capacity is said to be 100,000 wafers per month and would thus come close to TSMC's Gigafabs. But the question remains: Who equips the fab?

No newest machines because of trade boycott

The technologies to equip such modern semiconductor factories are not available in China. Import bans on the part of the USA affect, among other things, ASML as the world's largest factory equipment supplier, but also Applied Material and Lam Research. The most modern lithography systems and tools are therefore not available. So older systems or alternatives have to be taken that are not affected. But you cannot take part in the high-end race with this. SMIC's Co-CEO Zhao Haijun is in talks with the USA and his own government, but it does not look like a quick solution at the moment. SMIC has been officially on the US banned list since September last year.

SMIC therefore declares today that the new plant is initially designed for chips with a structure width of 28 nm and older. The product field that can be served with it is still huge. There are chip shortages in almost every industry, many microcontrollers, WLAN chips, ICs for the vehicle industry, but also image sensors and many components for products from the consumer electronics sector rely on these older production stages. In China in particular, where many products are ultimately manufactured for the global market, the chips would find their buyers. SMIC had already announced a new factory building last year, with 40,000 wafer starts per month.

TSMC is also upgrading in China

TSMC recently made it clear once again how important the Chinese market is. Their Fab16 in Nanjing will be significantly expanded for 2.9 billion US dollars by 2023, but only technologies that produce chips in 28 nm or larger will be used there. But technology theft is also important to TSMC here, additional funds were released especially for this.