Powerchip Semiconductor Manufacturing Corp (力積電) is in preliminary talks with multiple Indian conglomerates to help build new chip plants in the country, it said yesterday, as India subsidizes local chip capacity buildup.
The statement from the maker of memory chips and power management ICs confirmed speculation in the past six months that it was looking to invest in India to diversify its operations amid mounting geopolitical tension.
The company was following similar moves by Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), United Microelectronics Co (聯電) and Hon Hai Precision Industry Co (鴻海精密).
Photo: Lisa Wang, Taipei Times
Tata Group was reportedly one of the possible partners in talks with Powerchip over building a semiconductor fab. Powerchip declined to disclose which companies it is in discussions with.
It is becoming a trend for Taiwanese semiconductor firms to expand operations globally, after TSMC announced its first US semiconductor investment plan, worth US$40 billion, Powerchip said.
“Local semiconductor companies now have to think more seriously about globalization than before,” Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a news conference in Taipei arranged by Taiwan Advanced Automotive Technology Development Association.
“We are preparing to sign an agreement with India to help it build a plant. It is determined to build one. We are trying to figure out how to support them since we have had similar experience in China,” Huang said.
As India imposes high import duties on semiconductor, it is more cost effective for Indian firms to build a local chip plant, he said.
Powerchip’s parent company, Powerchip Investment Holding Corp (力晶創新投資控股), in October 2015 formed Nexchip Semiconductor Corp (晶合集成) with the Sichuan provincial government to build and operate a fab in Chengdu, China.
Nexchip makes less-advanced chips such as display driver ICs using 150-nanometer and 90-nanometer processes.
Powerchip Investment Holding owns about 27.44 percent of Nexchip Semiconductor shares and a 23.49 stake in Powerchip Semiconductor.
As the talks in India are in the initial stage, Powerchip said it is unclear what role the company would play — as a technology supporter or an equity investor of a joint venture.
US-China trade disputes are positively affecting Taiwanese manufacturers, as Chinese firms and US companies with operations in China are looking for a second source to prevent their shipments from being blocked by Washington, Huang said.
“Taiwan is the best provider of a second source,” he said.
He said he expects Powerchip’s business to start to rebound in the second half of this year, after major supply chain inventory adjustments end following COVID-19 disruptions.
Some notebook computers are still in the process of digesting excessive inventory, he said.
“The first quarter will be the bottom,” he said.
Powerchip said it is cutting factory utilization to cope with sluggish demand, but its loading rate is not as low as some chipmakers that halved production in an attempt to weather the downturn.
The company said it is also facing delays of about six months in ramping up a new 12-inch plant, dubbed the P5 fab, in Miaoli County’s Tongluo Science Park (銅鑼科學園區) due to an extended lead time for semiconductor manufacturing equipment.
Taiwan’s technology protection rules prohibits Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) from producing 2-nanometer chips abroad, so the company must keep its most cutting-edge technology at home, Minister of Economic Affairs J.W. Kuo (郭智輝) said yesterday. Kuo made the remarks in response to concerns that TSMC might be forced to produce advanced 2-nanometer chips at its fabs in Arizona ahead of schedule after former US president Donald Trump was re-elected as the next US president on Tuesday. “Since Taiwan has related regulations to protect its own technologies, TSMC cannot produce 2-nanometer chips overseas currently,” Kuo said at a meeting of the legislature’s
TECH WAR CONTINUES: The suspension of TSMC AI chips and GPUs would be a heavy blow to China’s chip designers and would affect its competitive edge Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s biggest contract chipmaker, is reportedly to halt supply of artificial intelligence (AI) chips and graphics processing units (GPUs) made on 7-nanometer or more advanced process technologies from next week in order to comply with US Department of Commerce rules. TSMC has sent e-mails to its Chinese AI customers, informing them about the suspension starting on Monday, Chinese online news outlet Ijiwei.com (愛集微) reported yesterday. The US Department of Commerce has not formally unveiled further semiconductor measures against China yet. “TSMC does not comment on market rumors. TSMC is a law-abiding company and we are
FLEXIBLE: Taiwan can develop its own ground station equipment, and has highly competitive manufacturers and suppliers with diversified production, the MOEA said The Ministry of Economic Affairs (MOEA) yesterday disputed reports that suppliers to US-based Space Exploration Technologies Corp (SpaceX) had been asked to move production out of Taiwan. Reuters had reported on Tuesday last week that Elon Musk-owned SpaceX had asked their manufacturers to produce outside of Taiwan given geopolitical risks and that at least one Taiwanese supplier had been pushed to relocate production to Vietnam. SpaceX’s requests place a renewed focus on the contentious relationship Musk has had with Taiwan, especially after he said last year that Taiwan is an “integral part” of China, sparking sharp criticism from Taiwanese authorities. The ministry said
US President Joe Biden’s administration is racing to complete CHIPS and Science Act agreements with companies such as Intel Corp and Samsung Electronics Co, aiming to shore up one of its signature initiatives before US president-elect Donald Trump enters the White House. The US Department of Commerce has allocated more than 90 percent of the US$39 billion in grants under the act, a landmark law enacted in 2022 designed to rebuild the domestic chip industry. However, the agency has only announced one binding agreement so far. The next two months would prove critical for more than 20 companies still in the process
RSS