China’s quest for self-sufficiency in chipset manufacturing is not only giving its 14nm chip-making capability a significant boost towards full maturity but also positioning the country as a key global partner in the chipset space as the supply chain shifts in favor of the Asia-Pacific region. How? Via a combination of advances in industrial technology, long-term stable investment and rising market demand.
In the post-Moore’s Law era of integrated circuits (IC) development, developments in industrial technology have given chipset makers more room for innovation. This is especially true for chipset companies that were previously behind the curve somewhat in terms of manufacturing capabilities.
China has quickly emerged as a textbook example, with its 14nm capabilities accelerating over the past couple of years as Chinese companies have overcome many of the technical problems of developing 14nm chips, says Cai Yimao, Vice Dean of School of Electronic Engineering and Computer Science Peking University.
“Key equipment such as etching machines and thin film deposition have been realized from scratch and applied in large-scale production lines,” Cai says. “Breakthroughs have been made in the research and development of the 14nm process. The results of subsequent packaging integration technology have been fully realized in mass production. And hundreds of key materials, such as polishing agents and sputtering targets, have passed the assessment of large production lines and entered mass sales.
These developments essentially cover the entire IC industrial chain. Meanwhile, Cai adds, most of the relevant industries in that supply chain are either currently upgrading themselves in terms of data intelligence and industrial upgrades, or have already done so.
All of this has been driven by the ongoing technology battle between China and the US, in which the US has been using its export rules to ban US companies from supplying any chip component or manufacturing equipment to Chinese companies. China’s response has been to beef up its domestic production of chipsets to be self-reliant by 2025. Its 28nm chipset sector is on track for full maturity this year, and 14-nm chipsets are on track to follow suit by 2022.
“The promulgation of relevant policies has made it clear that China continues to support the IC industry as a pillar industry,” Cai says. “China attaches great importance to the development of the IC industry and continuously strengthens policy support and investment. Relevant technologies have also made great progress, and their international influence has gradually increased.”
Interestingly, while China’s progress in IC development has enabled local enterprises to source domestic alternatives to overseas suppliers, it has also potentially given China an edge in the global chip market – not least by positioning China to capitalize on the current shift of the global IC supply chain from the United States, Japan, Europe, and Taiwan to China, Southeast Asia and other regions.
As the world’s largest market, Cai says, China should continue to play an active role in promoting open cooperation. “With the protection of relevant investment and industrial policies, the attractiveness of China’s investment in the field of IC and technology applications will be largely enhanced, which will promote the integration and attraction of China’s IC industry with the global supply chain and encourage world semiconductor manufacturers to set up production and R&D institutions in China.”
For this to happen, Cai notes that while 14nm production will benefit from the domestic advances achieved in the 28nm chip space, the technical challenges, development costs and risks of 14nm development have also increased accordingly compared to older generations.
With the capacity of domestic production being limited by fluctuations in international trade, Cai says that Chinese companies will need to ensure that 14nm production capacity can be increased in the existing environment. They will also need to strengthen talent cultivation, to provide maximum confidence to the relevant design companies entering the 14nm space.
The good news for China, Cai says, is that the shift in the supply chain towards China and Southeast Asia will drive domestic R&D of advanced technologies and spur rapid development of local enterprises as they accumulate technology expertise and management experience. Also, the gradual completion of the construction of new wafer fabs in mainland China provides new support for the chip industry in terms of reduced costs, expanded production capacity and geographical convenience.
Meanwhile, Cai says, the number and proportion of China’s IC production lines have continued to increase. “More than 20 300mm fab production lines have been put into production, and several are under construction. After completion, the national production capacity will be considerable. SMIC, the largest and most technologically advanced wafer foundry in mainland China, is the first IC foundry company in mainland China to achieve mass production of 14nm FinFETs, representing the most advanced independent research and development of IC manufacturing technology in mainland China level.”
So, despite the current challenges regarding the capacity of domestic production, the point is that China has mastered the technology for mass production of 14nm. Consequently, Cai says, “China’s domestic 14nm chips will be mass produced next year, with a better balance of performance, power consumption and cost than ever before.”