Everyone talk how underpriced TSMC, and leading edge foundries are, few talk how much underpriced are the legacy semi companies.

[Paul2]

A lot of early 200X fabs are still making many essential, single source chips, but they are owned by companies not doing that well financially, in comparison to how much money, and attention have flown to the leading edge.

While remembering how COVID chip surge revealed how a single number of fabs keep global car industry hostage, it came to me that even more of relatively new fabs have customers with obsolete designs who can't move to another foundry.

Long term manufactured products update their chipset far less often than IT stuff, and many industries like cars, aerospace, medical. some industrial equipment, and defence are regulatory doomed to use decades old chips, since the design change cost will far outweigh even 100-fold increase in semiconductor component cost.

While there are few still manufactured cars with 199X chips, you will be surprised how many 200X chips there are in 2024 season cars.

With fewer, and fewer 3rd tier semiconductors players still around, I think it's just a question of time, when the few remaining ones will be bought for pennies by somebody like Tan, and then see their service prices risen beyond imaginable.

 

[vslee]

China has bought up countless legacy machines over the past couple of years. So much so that they will eventually be chomping at the bit to make these legacy chips. Which will likely have the opposite effect on prices.

 

[Paul2]

China has bought up countless legacy machines over the past couple of years. So much so that they will eventually be chomping at the bit to make these legacy chips. Which will likely have the opposite effect on prices.

They have all the 200mm steppers, but they don't have all these locked clients.

It was bad foresight to buy and rip old foundries just for their equipment. They threw out the baby and kept the bathwater.

 

[BruceA]

Nothing like moving up a node and TSMC, UMC, GF, and SMIC have a node for you. You get PPA scaling, there is a reason they are on life support

 

[samwilde]

The 200mm equipment has likely already been deployed. As much as anyone in the industry would like for there to still be equipment leftover to use somewhere, good luck getting some. But this was not done by any of the major players in China. The 200mm equipment was sent to the small players like SiEn to make high voltage transistors.

300mm is way too big to make discretes for most companies.

The companies making discretes, MEMS, and so on would love to have 200mm equipment available. There is plenty of demand but no supply.

 

[Xebec]

Does anyone know if the EVs made in/by China are using much more modern ICs or are they still primarily 20 year old ICs? (i.e. BYD).

The reason I ask is the EV transition seems to be causing some pivot on what automakers are using in their vehicles (newer ICs in Tesla, Rivian - which VW is investing in now). This may be a forcing function to get automotive off of old nodes.

 

[Paul2]

Does anyone know if the EVs made in/by China are using much more modern ICs or are they still primarily 20 year old ICs? (i.e. BYD).

The reason I ask is the EV transition seems to be causing some pivot on what automakers are using in their vehicles (newer ICs in Tesla, Rivian - which VW is investing in now). This may be a forcing function to get automotive off of old nodes.

All infortainment are relatively new chips. It's mostly internal drivetrain parts, braking, auxiliary motor drivers which come from the same parts suppliers as in gasoline powered cars. So 20 years old Magna parts would have equally old chips in both EVs, and gasoline cars.

Where Chinese have advantages are small things like PMICs for auxiliary functions, auxiliary motor drivers, lighting, sensing, because for such small, non-critical things they can use Chinese parts, which are much newer. Because Chinese don't fight for markets with particularly insane certification requirements, they are not afraid of doing design changes, and replacing parts if one of them get taken down by supply chain disruption, especially the tiny stuff, while Europeans, and Japanese can sometimes pause the assembly line just to wait for, say, windshield wiper motors, because they ship to countries requiring every car sold to be identical to the crash-tested model down to every nut, and bolt.

Where particularly German car makers got hit was their addition to CANBUS everywhere, and attempting everything to talk on the bus. There, rare CANBUS enabled speciality ASICs, and MCUs with built-in motor controllers, and etc hold them in the semiconductor middle ages.

Germans also make much more of their own drivetrain parts, a servoactuators in gearboxes depend on ancient electronics for example. Drive by wire system, on 200X era mission critical Renesas MCUs with obscure proprietary ISA, which was hand programmed in assembler.

Power electronics can also be quite ancient, and not changing since 200X. Even 200X era IGBTs are more than enough for smaller car inverters.

 

[Paul2]

But this was not done by any of the major players in China

SMIC not counted as such? They were the last major foundry to build a brand new fab on 200mm, obviously seeing the trend. Though, they probably couldn't have though that their bet will play out so well.

 

[samwilde]

SMIC not counted as such? They were the last major foundry to build a brand new fab on 200mm, obviously seeing the trend. Though, they probably couldn't have though that their bet will play out so well.

Last one they built was a decade ago I think?
It is a bad idea to build a 200mm line as a foundry today. Has been for a long time. Bad economics.
Unless you are talking about niche specialized processes.

 

[Paul2]

Last one they built was a decade ago I think?
It is a bad idea to build a 200mm line as a foundry today. Has been for a long time. Bad economics.
Unless you are talking about niche specialized processes.

200mm capacity shortage was apparent starting around 7 years ago. And with mainland labour prices, manual operation is not an issue.

 

[samwilde]

200mm capacity shortage was apparent starting around 7 years ago. And with mainland labour prices, manual operation is not an issue.

This is kind of overstated since China already has higher labour prices than Mexico.
But yes 200mm wafer FOUPs can be handled by people much more easily so it decreases the amount of fab automation you need to get a facility up.

 

[soAsian]

Long term manufactured products update their chipset far less often than IT stuff, and many industries like cars, aerospace, medical. some industrial equipment, and defence are regulatory doomed to use decades old chips, since the design change cost will far outweigh even 100-fold increase in semiconductor component cost.

You're only gaining in the short term. Old tech will eventually die off, even if it's at a snail's pace.

SpaceX just pulled off something unreal, launching a giant rocket and successfully recovering the booster. Meanwhile, rumors are swirling about Boeing selling its space business. Boeing dominated the airplane industry, but who's to say SpaceX won't dominate space travel in the near future, just like Boeing?

If SpaceX can make space travel or point-to-point travel anywhere on Earth via rocket affordable and efficient, it could lead to a duopoly similar to Boeing and Airbus (SpaceX and BlueOrigin)

 

[tonyget]

Does anyone know if the EVs made in/by China are using much more modern ICs or are they still primarily 20 year old ICs? (i.e. BYD).

The reason I ask is the EV transition seems to be causing some pivot on what automakers are using in their vehicles (newer ICs in Tesla, Rivian - which VW is investing in now). This may be a forcing function to get automotive off of old nodes.

This is a channel dedicated to chinese EV controller units teardown，new teardowns being updated every week. The video is Chinese language，but you don't need to understand the audio，the IC parts number are clearly shown on the video

中飞动力投稿视频-中飞动力视频分享-哔哩哔哩视频

点击观看中飞动力的全部投稿视频，在这里可以查看中飞动力最新发布、最多播放和最多收藏的视频。

space.bilibili.com

 

[Paul2]

This is kind of overstated since China already has higher labour prices than Mexico.

Even at $2000-$3000 per month gross, technicians are a rounding error in the overall fabrication costs.