Advanced Semiconductors Xie Zhifeng: Incubator Chip Design Farewell to Passive Foundry

Advanced Semiconductor is one of the oldest analog electronic chip foundries in the world. Its predecessor was Shanghai Philips Semiconductor Co., Ltd., which was established in 1988. At the time, this factory in Caohejing, Shanghai, basically exported its products. Due to the conservative and lacking strategies of previous developments, from the time of listing in 2006 to 2009, this once-best-successive semiconductor company in China has experienced a three-year losing streak. At present, Advanced Semiconductor is centralizing the company's product line, and its current target is locked in products with relatively high profit margins such as automotive electronics, IGBT and MEMS. At the same time, in order to end the situation in which cooperation with large foreign companies and services cannot be guaranteed, Advanced Semiconductor is nurturing its upstream Chinese small and medium-sized chip design companies in order to bid farewell to the passive OEM model.

The path ranges from the control area of ​​luxury cars to the sensing devices of smart phones, from photovoltaics to wind power, and even to train systems. The proper operation of these devices is inseparable from the corresponding chip support. Shanghai Advanced Semiconductor Manufacturing Co., Ltd. ("Advanced Semiconductor") is one of the behind-the-scenes heroes.

Advanced Semiconductor is one of the oldest analog electronics chip foundries in the world and the largest manufacturer of automotive electronic wafers in China. Its predecessor was Shanghai Philips Semiconductor Co., Ltd., which was established in 1988. Just a year before that, it was Philips, which established a globally-famous company, TSMC, in cooperation with Taiwanese companies. TSMC focuses on digital circuits, while Advanced Semiconductor focuses on analog circuits.

Advanced semiconductors mainly produce wafers. Wafer is the previous process of the chip. After the wafer is cut, packaged and tested, it is the chip. Before the advanced semiconductor is what to take what products, passive OEM, rely on heaven to eat. According to Xie Zhifeng, president of Advanced Semiconductor, this once-benefit semi-conductive company in China has suffered a three-year losing streak from its listing in 2006 to 2009 due to the conservative and lacking strategy of its previous development.

"I started in March this year as President. My goal is to focus the company's products on automotive electronics, IGBTs (drive control power devices for wind, solar, and motor vehicles) and MEMS (triaxial gyroscopes). Such smart phones as the iPhone) went among these three major categories and increased the proportion of these products to more than 50% of the total.” Xie Zhifeng said that the profit margins in these three areas are relatively secure. In this year's global industry with large losses, Shanghai Advanced Semiconductor remains profitable.

Xie Zhifeng also revealed that advanced semiconductors are currently using their own technological accumulation over the years to nurture their upstream Chinese small and medium chip design companies in order to bid farewell to the passive OEM model. "In this way, the customers who place orders with us are not just foreign companies. The growth of these upstream Chinese companies will provide us with a large number of orders." Xie Zhifeng previously worked at Intel and came to Advanced Semiconductor. Prior to that, he served as Deputy General Manager of SMIC.

Advanced Semiconductor is located in Caohejing New Technology Development Zone, Shanghai, China. When it was built in 1988, it was surrounded by a green farmland. Advanced Semiconductor has a registered capital of 1.534 billion yuan and covers an area of ​​40,000 square meters. The products are basically exported and are exported to markets in Europe, America, Southeast Asia and other countries.

At present, advanced semiconductors have five-inch, six-inch and eight-inch three-seat factories and produce nearly one million large-scale integrated circuit chips. The standards and specialized semiconductors for advanced semiconductor production are designed by its customers, and its products are eventually used in computers, mobile phones, automobiles, wind turbines and so on.

“Taiwan Semiconductors is similar to our background, but what we are doing is analog chips. Analog signals are those that are visible and tangible in the real world, such as images, sounds, and temperatures. The world is analog and digital signals are 0 and A composition, digital chip is mainly used for data calculation and transmission, people still need to perceive the world through analog signals.” Xie Zhifeng explained, “For digital TV as an example, it is the first image of this analog signal into digital The 0-1 code of the signal is then transmitted so that it is not easily distorted.After reaching the user's home, the digital signal is converted into an analog signal.The difficulty of the analog signal is actually greater because it is not a 0-1 but a The gradual process is like having many transitions between black and white."

In the IT industry, there is a popular saying that it is Moore's Law to double the performance every 18 months when the cost is constant. Today, in Xie Zhifeng's office, there is an outstanding achievement award that Intel awarded to him in 1990. Under the medal, there was the signature of Intel Chairman Moore.

"The analog circuit breaks this rule. The cost is relatively fixed and the price is relatively fixed. The stability is the property of the analog circuit. Because of its complexity, it is not easy to copy and the change is very small. For example, the chip in our car may be Ten years ago the design, but the manufacturers were still required to reproduce 10 years of such products.” Xie Zhifeng said, “This is equivalent to saying that in more than 20 years of time, the design of the product will not change. In fact, everyone The biggest concern is the risk brought by the new design, such as automotive chips, compared with reliability and stability, how low the price, and how small the size is secondary.After many analog chips become too small, they do not work. ."

Xie Zhifeng said that, compared with digital circuit chips, it is a field that is quickly eliminated and needs to continuously roll huge investments. "Taiwan Semiconductor Manufacturing Co., Ltd. is the most profitable digital circuit foundry company. But if you draw a line, as of now, you see that it has invested more money than you have earned and invested in the past 24 years. It makes money." The key is continuous input and output, which is a dynamic process, and once it is broken, companies will be unable to sustain themselves, and driven by Moore’s Law, there will only be a few companies that will eventually survive, and these companies will have countries behind them. Supporting figure."

Implanting the "Chinese core" for cars

Although China is already the world’s first consumer of automobiles, all chips in automobiles need to be imported. While the automotive industry is in the process of development, the demand for electronic devices is increasing. Behind this, it also needs chip support. Electronicization plays an irreplaceable role in the control systems, communication systems, and security systems of automobiles. For example, Xie Zhifeng said, “In the past, a car needed only a few chips, but the engine was equipped with a bit, then the radio was equipped with a bit. But you can see now that the application of the chip is almost everywhere. Before the windows were still cranked, they are all electric. There are chips to be used here. A good car with tire pressure will have a dedicated chip for signal processing and conduction. We are currently doing this."

China does not directly produce the above-mentioned chips, but has the chip's upper product, wafer production capacity. At present, the only domestic manufacturer of automotive chip wafers is advanced semiconductors. Xie Zhifeng emphasized that Advanced Semiconductor has increased investment in automotive chips to highlight its advantages. “We lost a few years before, and I must look for advantages. I found that sales in the automotive sector are less than 2% (2009 data Improving the level of electronics is a trend in the automotive industry.” Advanced Semiconductor decided to increase investment in automotive electronics applications. With the help of government and strategic partners, Advanced Semiconductor passed a European automotive electronic quality standard system VDA6.3. The system was created by a German company in mainland China. The A-class standard is 90 points or more, and it can supply chips to world-class premium car manufacturers such as BMW and Mercedes-Benz.

“Now our proportion of chip production in total sales has risen from 2% to more than 10%. We have to produce more than 10,000 pieces a month. In the past month, we would probably have hundreds of films and thousands of films. Looks like.” Xie Zhifeng said. However, the automotive system is very complicated. A car may use hundreds of chips. Advanced semiconductors do not do everything but concentrate on the overall communications and local communications. This year, the overall demand for automobiles is still very strong. In addition to the Great Earthquake in Japan, some of the wafer factories in Japan have been affected, and advanced semiconductors have thus obtained a good opportunity for development. “Our direct customer is a chip factory, and the chip manufacturer customer is a car manufacturer. This year’s market is whether we work overtime or not. The final customer’s customers come over and ask if we can produce more. For a $2 chip, The car factory could not get out of hundreds of thousands of cars."

Advanced Semiconductor’s sales in automotive electronics in 2010 was more than RMB 40 million, and the company expects to exceed RMB 100 million this year. Xie Zhifeng disclosed that “in the future we hope to achieve 20% of total sales.” As the first and only producer of Chinese automotive chip wafers, Xie Zhifeng said that the company will focus more on quality. Automotive chips are directly related to security. "Who wants his car to be open and break down, or even roll over? Now our excellent quality has been recognized by users. This is our brand." According to reports, Advanced Semiconductor has passed five consecutive times since 2009. The VDA6.3 auto industry process audit of Europe's top automotive OEM manufacturers and other automakers has become the first semiconductor wafer manufacturer in mainland China to have "A" grade supplier qualifications, and is currently the only company in the country to have international The automotive electronics chip market provides professional automotive electronics wafer manufacturing companies.

Positioning new areas In addition to automotive chips, advanced semiconductors also include IGBTs and MEMS. Xie Zhifeng said that the future of energy in the world is the starting point for increasing investment in IGBTs. If fossil fuel prices continue to rise and eventually become exhausted, renewable energy such as solar and wind power will gain significant development. IGBTs will play a key role in this. "For solar energy, for example, it uses a diode to convert light energy into electricity, but we all know that it is a direct current, and at present the basic electricity used by everyone is alternating current, so the conversion of direct current into alternating current requires an inverter. In this regard, there are also many years of accumulation, and we have already produced wafers for the world's number one IGBT chip factory in this field, said Xie Zhifeng. In fact, the IGBT application field is extremely wide. When it comes to high-power, high-voltage AC and DC chips, it can often be seen, such as wind, industrial control, power grid, defense, communications equipment, and high-power appliances. "I've been to our IGBT chip customer headquarters. They told me that many of China's high-speed rails use their products. The voltage is up to 6,500. "Our direct customers are chip factories, and chip manufacturers customers are car manufacturers." This year's market is whether we work more or less, or whether the supply is not enough. Finally, the client's customers run over and ask if we can produce more. For the $2 chip, car manufacturers may not get rid of hundreds of thousands of cars. ”

"It is very difficult to catch up with international giants in the traditional field, but in all areas where we are all new, all this is possible. In the automotive sector, our focus is on the application of electric vehicles," said Xie Zhifeng. Advanced Semiconductor supplies more than 10,000 pieces per month to the above-mentioned IGBT makers. "This is no second company in China. Others may still be in the R&D stage and really provide large quantities of energy-saving high-power devices. We are also unique in China. One.” Xie Zhifeng said that MEMS is also a very new field. It is a sensor. This sensor technology is now used in iPhones and iPads. “It is actually a three-axis gyroscope. This technology is very difficult to do. The world is also able to do a few companies. We can now produce small batches, and we can produce it in large quantities next year. This technology is very high. "The advanced semiconductor technology accumulated in the MEMS field comes from cooperation with a European company. "Now they cooperate with us. We are producing MEMS chips for the world's top three smart phone companies. The MEMS chip we produce is one of the most competitive chips in the world." Xie Zhifeng disclosed, "Now we can do it. 500 pieces per month, from 0 to 1, is very difficult, and now we are basically sizing up, and the scale will be even bigger next year."

Xie Zhifeng said that in fact, the whole chip foundry industry has entered a cyclical downturn this year, and many of its fellow companies have suffered large-scale losses. However, due to our timely transition, the three major areas of automotive chips, IGBTs, and MEMS have guaranteed margins. This has brought bright spots to the company as a result of declining demand, rising labor costs, rising prices, and appreciation of the renminbi. "If we don't focus, we will definitely lose money this year."

When it comes to the future, Xie Zhifeng said that it is difficult to catch up with international giants in traditional fields, and in all areas where everyone is brand new, all of this is possible. “In the automotive field, our focus is on the chip application of electric vehicles. Now that the country has a major special project in the automotive electronics industry, we call the automotive electronic control chip 02 special project. We and 8 domestic companies are working hard to apply to become a special undertaking unit. We will To form a national team of automotive electronic control chips, China is now a blank space in this area, and the chips in our mobile phones were previously imported entirely, and are now 100% domestically produced. Now the car's chips are imported 100%, I hope 10 years Since it can be made in the future, the nine units including the vehicle factory, chip manufacturing, and chip design are all completed by themselves. This project will be led by advanced semiconductors. The Shanghai municipal government strongly supports it."

Cultivating Chinese customers, Xie Zhifeng, stated that in the past few years, they have been doing OEM work for companies. In the past two years, their focus has been on nurturing Chinese chip customers. This will increase the number of companies in the future. Round order. "For the domestic chip design companies that want to make a difference in the chip field, advanced semiconductors can play an incubating role." Xie Zhifeng said, "We will sign contracts with enterprises. We will provide free services for enterprises. For example, the help of research and development, the help of chip testing, and some chip reliability standards, etc. In this process, we are provided free of charge. Afterwards, when the product is sold, we divide it again. This is a win-win mode. They can With quick start, we can increase demand.” Xie Zhifeng exemplifies that there is a company in Shandong, they are doing IGBT, the founder is a “sea return”, there is technology, but do not know where to help him transform the technology For the product, they later saw that Advanced Semiconductor was doing OEM work for the world's leading IGBT chip factory. This company has developed rapidly and has now received some national honors. Their president has also entered the Thousand Talents Program.

Xie Zhifeng said, “Now they can also make 1000 films a month. The global leading IGBT chip company orders me 10,000.” In fact, OEMs for Chinese companies and OEMs for foreign companies. There is an essential difference. “Foreign manufacturers have their own factories. They only use them when business is good. When business is bad, they do it themselves. This is because they rely on heaven to eat; while domestic design companies have no factory. , Its bad economy depends on us to eat, always have to do, so I always have a business with the design company's customers in the country, and cooperation with international big companies is the difference between a list and a non-list. The factory may not be able to feed enough, why would he give you?! So foreign customers will have greater risks. Domestic customers are more profitable than foreign customers."

For the future, Xie Zhifeng predicts, “I hope that next year's domestic IGBT chip plant orders will add up to 5,000 pieces per month, which is half of the global leader. I expect our company's IGBT plate The domestic customer orders will break out next year; MEMS will break out in the following year; automotive electronics may take another few years. This is a gradual process that may take three to five years, and we believe that the future can be fruitful."