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Memory-chip maker to rely on local equipment suppliers for 2024 manufacturing plans
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https://www.ft.com/content/9ad41255-dfa9-419f-9e30-0ab537ab54fd
Yangtze Memory Technologies Corp, China’s largest memory-chip maker, will begin production at a new plant as early as next year, boosting Beijing’s attempts to achieve self-sufficiency for its semiconductor industry in the face of crippling US export controls. Washington’s export curbs imposed last October on the equipment needed to make advanced chips had initially frozen the construction and kitting out of the leading-edge fabrication plant being built alongside the chipmaker’s existing fab, in the city of Wuhan in central China.
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https://www.ft.com/content/9ad41255-dfa9-419f-9e30-0ab537ab54fd
However, YMTC has been testing locally made tools over a long period and is now confident enough to rely more on domestic suppliers for replacements, according to people with direct knowledge of the situation. The new plant is now expected to be online in the second half of 2024. The company’s apparent success in reducing its reliance on US and other foreign chip equipment makers represents a blow to Washington’s hopes of export controls being able to slow China’s progress significantly in making advanced chips. YMTC had set ambitious targets for equipment from local vendors, including Naura Technology and Advanced Micro-Fabrication Equipment, said three people familiar with the matter. “YMTC has taken on the important and difficult task this year to de-Americanise the chip production line,” said an analyst close to the company, who requested anonymity.
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https://www.ft.com/content/9ad41255-dfa9-419f-9e30-0ab537ab54fd
YMTC, Naura and AMEC did not respond to requests for comment. The opening of the new fab in the latter part of 2024 would help it regain competitiveness with Samsung and Micron, its main rivals in Korea and the US respectively. YMTC had about a 5 per cent global market share in memory chips in 2021, up sharply from 1 per cent in 2020, according to research firm Yole Development. Management has also assured production engineers it will be able to source key chip manufacturing tools from Dutch equipment maker ASML, using older models not covered by a new US-Japan-Netherlands trilateral agreement on restricting exports, according to three company engineers. It will fill the remaining empty slots on the production line by reinstalling equipment from US suppliers taken from the older fab, where it is downsizing production, according to the engineers. “It is not cost-effective for YMTC to retreat to backward chip production when its competitors are pushing the envelope with more advanced products,” said Linghao Bao, an analyst at research firm Trivium China.
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Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found here.
https://www.ft.com/content/9ad41255-dfa9-419f-9e30-0ab537ab54fd
Yangtze Memory Technologies Corp, China’s largest memory-chip maker, will begin production at a new plant as early as next year, boosting Beijing’s attempts to achieve self-sufficiency for its semiconductor industry in the face of crippling US export controls. Washington’s export curbs imposed last October on the equipment needed to make advanced chips had initially frozen the construction and kitting out of the leading-edge fabrication plant being built alongside the chipmaker’s existing fab, in the city of Wuhan in central China.
Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found here.
https://www.ft.com/content/9ad41255-dfa9-419f-9e30-0ab537ab54fd
However, YMTC has been testing locally made tools over a long period and is now confident enough to rely more on domestic suppliers for replacements, according to people with direct knowledge of the situation. The new plant is now expected to be online in the second half of 2024. The company’s apparent success in reducing its reliance on US and other foreign chip equipment makers represents a blow to Washington’s hopes of export controls being able to slow China’s progress significantly in making advanced chips. YMTC had set ambitious targets for equipment from local vendors, including Naura Technology and Advanced Micro-Fabrication Equipment, said three people familiar with the matter. “YMTC has taken on the important and difficult task this year to de-Americanise the chip production line,” said an analyst close to the company, who requested anonymity.
Please use the sharing tools found via the share button at the top or side of articles. Copying articles to share with others is a breach of FT.com T&Cs and Copyright Policy. Email licensing@ft.com to buy additional rights. Subscribers may share up to 10 or 20 articles per month using the gift article service. More information can be found here.
https://www.ft.com/content/9ad41255-dfa9-419f-9e30-0ab537ab54fd
YMTC, Naura and AMEC did not respond to requests for comment. The opening of the new fab in the latter part of 2024 would help it regain competitiveness with Samsung and Micron, its main rivals in Korea and the US respectively. YMTC had about a 5 per cent global market share in memory chips in 2021, up sharply from 1 per cent in 2020, according to research firm Yole Development. Management has also assured production engineers it will be able to source key chip manufacturing tools from Dutch equipment maker ASML, using older models not covered by a new US-Japan-Netherlands trilateral agreement on restricting exports, according to three company engineers. It will fill the remaining empty slots on the production line by reinstalling equipment from US suppliers taken from the older fab, where it is downsizing production, according to the engineers. “It is not cost-effective for YMTC to retreat to backward chip production when its competitors are pushing the envelope with more advanced products,” said Linghao Bao, an analyst at research firm Trivium China.
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