Intel has reportedly delayed its construction of Fab 29.1 and 29.2 in Magdeburg, Germany, as the new timeline now pushes the start of construction to May 2025, according to a report by tom’s Hardware, citing German media outlet Volksstimme.

However, the fabs could still become operational by late 2027 or early 2028 if the semiconductor giant expedites construction and tool installation, the report stated. The current scenario does seem challenging though, as the company has to deal with black soil removal issues and delays in subsidy approvals.

In June 2023, Intel reached an agreement with Germany, announcing the signing of an amended investment memorandum. The plan involves investing over EUR 30 billion to construct two new fabs in Magdeburg, of which the German federal government has agreed to provide a subsidy of EUR 10 billion, including incentives and subsidies from the European Chips Act and government initiatives.

Originally, construction was scheduled to begin in the first half of 2023 but was postponed to summer 2024 due to delays in subsidy approvals. Until recently, the EU Competition Authority has not yet approved the around EUR 10 billion subsidy.

The topsoil removal process, as required by law, thus, has been rescheduled to May 2025. In the meantime, Intel and the state are adjusting plans, focusing on infrastructure development and land acquisition to prepare for the delayed construction, according to the aforementioned reports.

Fab 29.1 and Fab 29.2 were initially planned to begin operations in late 2027, utilizing Intel’s 14A (1.4nm) and 10A (1nm) process nodes for specific products on Intel’s roadmap, the reports noted. Although Intel has some time to ramp up the fab even if it becomes ready by mid-2028, the schedule remains tight.

The report from Volksstimme even indicated that Intel now estimates it will take four to five years to build the two factories, with production potentially starting in 2029 or 2030.

On the other hand, regarding major semiconductor companies’ overseas expansion progress in Germany, in mid-May, TSMC confirmed that it will start construction of its first chip plant in Europe in Dresden, eastern Germany, in the fourth quarter of this year, with production expected to begin in 2027.

It is understood that TSMC’s fab in Germany will initially focus on the 22-nanometer process, mainly producing automotive microcontrollers. There is a possibility of expanding to produce more advanced chips in the future.

Read more

• [News] Intel Submits Conceptual Drawings for Fab Construction in Germany, Installing High-NA EUV Exposure Machines
• [News] TSMC Confirms Construction for Its First European Chip Plant to Commence in Q4, as Scheduled

(Photo credit: Intel)

According to a report from Nikkei News, Japan will require companies in critical industries such as semiconductor and machine tools to take measures to prevent cross-border technology leaks in order to receive government assistance.

The planned technology transfer rules will reportedly apply to five sectors: semiconductors, advanced electronic components, batteries, aircraft components, and machine tools and industrial robots.

The Ministry of Economy, Trade, and Industry (METI) will issue revised guidance regarding these sectors, which are part of the 12 critical materials designated by Japan under the Economic Security Act of 2022. This move aims to maintain Japan’s international competitiveness in advanced technology fields such as chip manufacturing materials and carbon fiber used in aircraft.

Companies applying for subsidies will first need to declare the “core technologies” they need protection for. The protective clauses of the METI will include measures to minimize the number of personnel involved in critical materials and require relevant staff to sign contracts committing not to take sensitive technology with them when they leave the company.

For companies that share technology with business partners, all parties must sign confidentiality agreements. They must also restrict the number of personnel involved in critical technology and monitor these employees.

For enterprises seeking to manufacture overseas or expand production of critical technology, they must consult with the METI in advance. This regulation is also aimed at avoiding dependence on such technology imports.

If a company producing advanced semiconductors wishes to increase overseas production by 5% or more, it must notify the ministry. For traditional semiconductors, increasing overseas production by more than 10% will trigger this requirement. Beneficiaries who violate the protective clauses may be required to repay subsidies.

Besides Japan, the US Department of Commerce also released details regarding its CHIPS and Science Act, which stipulates that beneficiaries of the act will be restricted in their investment activities—for more advanced and mature processes—in China, North Korea, Iran, and Russia for the next ten years.

The scope of restrictions in this updated legislation will be far more extensive than the previous export ban, further reducing the willingness of multinational semiconductor companies to invest in China for the next decade.

Read more

• [News] Strengthening Controls on Semiconductor Equipment Exports to China, Japan Reportedly Tightens Export Control Measures Further
• [News] A Subsidy Wave Sweeping in the US, Europe and Japan amid the Cut-Throat Chip Competition

The global semiconductor supply chain may face disruption as the Samsung Electronics union announces its first-ever company strike on June 7. According to a report from BBC, approximately 28,000 union members, accounting for more than 20% of Samsung’s total workforce, are expected to participate. The union accuses the company of long-term neglect of employees’ and the union’s demands.

Samsung Electronics is a major subsidiary of the Samsung Group, primarily responsible for the design, production, and assembly of consumer electronics, semiconductors, and communication devices. In the wafer foundry sector, Samsung is a key competitor to TSMC, with the two giants vying for leadership in advanced manufacturing processes.

In addition to its impact on the foundry industry, Samsung is also one of the world’s largest smartphone manufacturers and a leader in memory production. It is among the few global companies capable of integrating advanced memory chips into generative artificial intelligence technology.

Samsung is now facing the impact of a strike, which could further affect the global semiconductor supply chain.

However, as per industry sources cited by TechNews, it’s suggested that the strike by the Samsung union is unlikely to impact plant operations significantly.

As the union announces the strike, there has also been a significant shake-up in the chip division’s leadership. Young Hyun Jun has been appointed as the new head of the Device Solutions (DS) division, responsible for leading the company’s semiconductor business.

Per a report from Reuters, a source has noted that since Samsung’s personnel changes typically occur at the beginning of the year, it is unusual to replace a high-ranking executive like this in the middle of the year.

Read more

• [News] Samsung Expected to Unveil its 1nm Plan in June, Advancing it to 2026
• [News] Samsung Leadership Change, Young Hyun Jun to Head Device Solutions Division

(Photo credit: Samsung)

As the demand for AI chips keeps booming, memory giants have been aggressive in their HBM roadmaps. SK hynix, with its leading market position in HBM3e, has now revealed more details regarding HBM4e. According to reports by Wccftech and ET News, SK hynix plans to further distinguish itself by introducing an HBM variant capable of supporting multiple functionalities including computing, caching, and network memory.

While this concept is still in the early stages, SK hynix has begun acquiring semiconductor design IPs to support its objectives, the aforementioned reports noted.

According to ET News, the memory giant intends to establish the groundwork for a versatile HBM with its forthcoming HBM4 architecture. The company reportedly plans to integrate a memory controller onboard, paving the way for new computing capabilities with its 7th-generation HBM4e memory.

By employing SK hynix’s technique, the package will become a unified unit. This will not only ensure faster transfer speeds due to significantly reduced structural gaps but also lead to higher power efficiencies, according to the reports.

Previously in April, SK hynix announced that it has been collaborating with TSMC to produce next-generation HBM and enhance logic and HBM integration through advanced packaging technology. The company plans to proceed with the development of HBM4 slated to be mass produced from 2026, in the initiative.

As more details relating to HBM4 have been revealed now, the memory heavyweight seems to extend its leading market position in HBM3 by addressing the semiconductor aspect of the HBM structure, Wccftech said.

According to TrendForce’s analysis earlier, as of early 2024, the current landscape of the HBM market is primarily focused on HBM3. NVIDIA’s upcoming B100 or H200 models will incorporate advanced HBM3e, signaling the next step in memory technology. The current HBM3 supply for NVIDIA’s H100 solution is primarily met by SK hynix, leading to a supply shortfall in meeting burgeoning AI market demands.

In late May, SK hynix has disclosed yield details regarding HBM3e for the first time. According to a report from the Financial Times, the memory giant has successfully reduced the time needed for mass production of HBM3e chips by 50%, while close to achieving the target yield of 80%.

Read more

• [News] SK Hynix Revealed Progress for HBM3e, Achieving Nearly 80% Yield
• [News] SK Hynix Partners with TSMC to Strengthen HBM Technological Leadership

(Photo credit: SK hynix)

According to Daily Telegraph, Coherent’s fab located in Newton Aycliffe, County Durham, Northern England, is facing potential sale or closure as Apple ceased a supply agreement. Currently, the plant is under review, which might turn out to be sold. Coherent has issued a last-time-buy notice to its customers.

The UK fab primarily manufactured III-V compound semiconductor RF microelectronics and optoelectronic devices for communications, aerospace and defense sectors. The collaboration between the plant and Apple involved Face ID feature in iPhones.

However, Apple had put an end to the related key product supply contract with Coherent in late fiscal 2023. In its latest financial report, Coherent noted a significant decline in sales of VCSEL products for 3D sensing in Apple’s iPhones, which had a remarkable impact on the company’s overall revenue.

It’s worth noting that Coherent’s fab laid off over 100 employees in April 2023, retaining around 250. Later, Coherent indicated in the last-time-buy notice that Apple’s termination of the supply agreement further placed the ongoing viability of the business in doubt. A strategic review is undertaken, with potential new technologies or a sale as options under consideration. It remains to be seen if the UK government will weigh in to broker a sale to an acceptable buyer.

• Apple’s Supply Chain Changes with the Evolution of VCSEL Technologies

Likewise, another optical and photonics device manufacturer, Lumentum, has fallen into a similar situation. Per foreign media reports in March 2024, Lumentum would dismiss 750 staffs, which accounts for 10% of its global workforce at the time.

Lumentum is a core supplier of VCSEL lasers for Apple’s iPhone 14 Pro series. However, Ming-Chi Kuo, renowned Apple analyst, revealed in early 2023 that Sony would replace Lumentum in design, and become the exclusive supplier of VCSEL products for the LiDAR scanner in the iPhone 15 Pro series. This variation implies a reduced market share for Lumentum in the VCSEL segment of iPhone.

Indeed, Apple has consistently updated its technologies in smartphones, resulting in corresponding structural and design adjustments and changes in its supplier lineup.

TrendForce’s latest research report, “2024 Infrared Sensing Application Market and Branding Strategies,” shows iPhone 15 Pro adopts Sony’s stacked structure technology, which integrates the VCSEL, driver IC, SPAD, and ISP (ASIC Chip) in a stacked structure. This approach significantly reduces system size while achieving high-speed response and high output power, providing better LiDAR scanning performance at the same power level, extending battery lifespan, and enhancing camera and augmented reality capabilities.

Furthermore, TrendForce’s survey reveals that Apple plans to introduce MetaLens technology in 2024 to reduce the size of emitting components, and to adopt under-display 3D sensing technology in 2027 to increase the display screen ratio. Under-display 3D sensing uses short-wave infrared VCSEL (SWIR VCSEL) to reduce interference from sunlight and ambient light and minimize the occurrence of white spots. Noticeably, 1,130nm VCSEL has achieved a PCE (Photoelectric Conversion Efficiency) of over 30%, and currently, ams OSRAM’s 1,130nm VCSEL can already deliver superior performance, enabling it to come out on top in the market.

Thereby, it is evident that the continuous evolution of Apple’s iPhone 3D sensing solutions has caused striking changes in the VCSEL ecosystem. With new manufacturers like Sony entering the supply chain, Coherent and Lumentum are suffering a gradual decline in their market shares.

• More Opportunities Emerge amid the Overwhelming Trend of AI

While consumer electronics remain a crucial market for VCSEL technology, the global AI wave is driving its increasing importance in data center, optical communication, and automotive LiDAR, which will position VCSEL as a vital support for implementing AI functionalities. For example, VCSEL is a perfect fit for short-distance optical interconnections in data center, underpinning the operation of cloud and edge computing infrastructure integral to AI computing.

Currently, photonics manufacturers are already gearing up to develop higher-performance VCSEL technology to meet potential demands in high-growth application areas such as AI, high-performance computing (HPC), networking, and automotive LiDAR. In this context, VCSEL market demand and market size are expected to enjoy ongoing growth, presenting more opportunities for related manufacturers and infusing new vigour into their business growth.

Read more

• [News] Apple COO Rumored to Make Secret Visit to TSMC, Booking Advanced Capacity for AI In-house Chips
• [News] Apple Unveiled M4 Chip for AI, Heralding a New Era of AI PC

(Photo credit: Apple)