GlobalFoundaries today announced a $10B project to build an advanced semiconductor manufacturing plant in the central Chinese city of Chengdu. The timing of the deal’s announcement – two days after Intel and President Trump jointly announced Intel’s plans to spend $7B on a U.S. based fab – is interesting. The battle for preeminence in chip technology has been heating up in recent years with China striving to become more technology independent and a leader in computer technology.
An article in the New York Times today (Plan for $10 Billion Chip Plant Shows China’s Growing Pull) suggests the announcement is more evidence of the shift of semiconductor technology’s center of gravity towards China. The U.S., under President Obama, enacted trade restrictions on some high-end Intel processors. At least partly in response, China built the Sunway Taihulight, currently on top of the Top500 list, using home-grown components. President Trump further riffled the waters with provocative statements discounting China’s long-held One China policy in which Taiwan is seen as a part of China. Trump reversed himself on that issue this week.
GlobalFoundaries is based in California. Noteworthy, process details for new fab were not spelled out although it is not expected to be cutting edge.
According to the article, China will spend about $100 billion to bring chip factories and research facilities to China. “Almost all of the large semiconductor enterprises in the United States have received investment offers from Chinese state actors,” according to a report from the Mercator Institute for China Studies, a think tank based in Germany. The report added that China’s newest industrial policy, Made in China 2025, had named semiconductors as a crucial area to improve.
The Times also reported: “Jason Gorss, a GlobalFoundries spokesman, declined to provide financial details but said in an email that “industry analysts estimate that the total cost of an advanced semiconductor fab is on the order of $10B and this fab will be in that range.” It is not clear how much investment is being provided by the company and how much by the Chengdu government.” The article, written by Paul Mozur, looks at the shifting landscape.
Link to New York Times article (Plan for $10 Billion Chip Plant Shows China’s Growing Pull): https://www.nytimes.com/2017/02/10/business/china-computer-chips-globalfoundries-investment.html?mabReward=R1&recp=0&version=readinglist&action=click&pgtype=Homepage&clickSource=story-heading&module=c-column-middle-span-region®ion=c-column-middle-span-region&WT.nav=c-column-middle-span-region&_r=0