Per a report by the Vietnam News Agency, Vietnamese Prime Minister Phạm Minh Chính recently signed Government Decree No. 791/QĐ-TTg on the establishment of the National Steering Committee for Semiconductor Industry Development.

The main tasks and functions of the steering committee include assisting the Prime Minister and the government in researching, guiding, and coordinating the resolution of important and cross-departmental matters related to promoting the development of Vietnam’s semiconductor industry; researching, consulting, and advising on directions and solutions to promote the industry’s growth; and guiding the coordination among various departments, government agencies, relevant organizations, and entities to vigorously advance the development of Vietnam’s semiconductor industry.

Semiconductor industry is one of the strategically important global industries, and it undoubtedly represents a significant development opportunity for Vietnam.

It is reported that the semiconductor, as one of Vietnam’s nine national-level products, has been included in the country’s key development priorities for the next 30 to 50 years.

According to its National Semiconductor Industry Strategy, Vietnam aims to become a global center for semiconductor chip design, packaging, and testing by 2030.

To achieve this goal, the Vietnamese government has introduced a series of preferential policies and incentives to encourage foreign enterprises to invest in the country.

Moreover, the government has established the National Innovation Center (NIC) to create a high-tech ecosystem and beef up the training of professionals to meet the needs of developing semiconductor industry.

Currently, Vietnam has drawn in investment from foreign enterprises such as Intel, ASE Group, Samsung Electronics, Amkor, Qualcomm, ONSemi, Renesas, Texas Instruments, NXP, Marvell, Synopsys, Hana, and Anpei. In fact, with global capital investment, Vietnam’s semiconductor industry ecosystem is gradually taking shape in recent years.

Vietnam’s Minister of Planning and Investment Nguyễn Chí Dũng stated that Vietnam boasts some conditions and factors conducive to the development of semiconductor industry, involving a stable political system, a favorable geographical location, and attractive investment incentive policies.

The Vietnamese government has been committed to developing semiconductor industry and hopes to attract more and more large enterprises to invest in Vietnam.

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(Photo credit: Intel)

Automotive chip market, previously enjoying robust growth among the semiconductor sector, is now showing signs of slowing down.

According to a report from WeChat account DRAMeXchange, the major foundry UMC announced that it expects customer inventories in the communications, consumer electronics, and computer sectors to return to seasonal levels as usual in the second half of this year, and to reach healthy levels by the end of the year.

However, demand in the automotive end market remains weak, which may extend the period of inventory adjustment, with healthy levels anticipated only by the first quarter of next year.

Another foundry giant, TSMC, warned in its latest financial statement that the automotive market might decline this year in spite of a quarter-on-quarter increase of 5% in the revenue of its automotive electronics end market in 2Q24.

Meanwhile, the sluggish growth trend in the automotive chip market is also exemplified by the business performance of three leading automotive chip companies—Texas Instruments, STMicroelectronics, and NXP as they all saw declines in revenues.

Texas Instruments’ revenue for 2Q24 was USD 3.82 billion, down 16% YoY and the sales of its industrial and automotive business continue to decrease.

STMicroelectronics delivered revenue of USD 3.23 billion, down 25.3% YoY, with automotive business revenue falling short of expectation, offsetting growth in personal electronics sales.

NXP’s achieved revenue of USD 3.13 billion, down 5.2% YoY and its automotive business generated revenue of USD 1.728 billion, down 7.4% YoY, indicating the decline widened compared to the first quarter.

Despite the strong growth in the automotive chip market in 2023, the industry believes that as the overall automotive end market fails to advance as expected and there is an overcapacity in some automotive chip markets, automotive chip market growth will slow down in 2024, with the growth rate dropping to single digits in the coming years.

It’s learned that automotive semiconductor can be broadly categorized into microcontroller (MCU), computing chip (CPU, GPU, NPU, etc.), sensing chip (radar, image sensor, photoelectric sensor, etc.), memory chip (DRAM, NAND Flash, etc.), communication chip (CAN bus chip, connectivity chip, etc.), and power chip (IGBT, silicon carbide, etc.), among others.

In the view of the industry, current MCU and other chips are facing significant inventory pressure due to the declining automotive end market demand. However, power chip and autonomous driving chip continue to see strong demand driven by the wave of automotive electrification and intelligence.

Therefore, while the automotive semiconductor market may slow down in the short term, the automotive chip market still possesses growth potential in the long run with the continuous adoption of silicon carbide and autonomous driving chips in the increasingly popular EV and smart vehicle markets.

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(Photo credit: Pixabay)

Due to the impact of international situations and uncontrollable factors, the global semiconductor supply chain is undergoing a shift. According to a report from WeChat account DRAMeXchange, the Southeast Asian region, with its advantages in labor and development conditions, has become the preferred location for major global companies. Countries such as Malaysia, India, and Singapore have been targeted by many manufacturers, who are rapidly setting up operations to secure a foothold.

On June 5, Taiwan-based contract chipmaker Vanguard International Semiconductor Corp. (VIS) announced to team up with Netherlands-based semiconductor supplier NXP Semiconductors N.V. to set up a joint venture, VisionPower Semiconductor Manufacturing Company (VSMC), and build a 12-inch fab in Singapore.

The fab will have an investment of approximately USD 7.8 billion. VIS will invest USD 2.4 billion and take a 60% stake, with NXP to invest USD 1.6 billion and a 40% share. The fab will be operated by VIS.

Besides, both parties have promised to allocate a total of USD 1.9 billion of long-term capacity security deposit and usage fees, with the remaining funds (Loans included) to be provided by third parties.

VSMC will run as an independent wafer manufacturing service provider, offering a certain proportion of its capacity to both partners. By 2029, the fab’s monthly 12-inch wafer capacity is expected to reach 55,000 pieces, which is projected to create around 1,500 jobs in Singapore. Following the successful mass production of the first fab, both sides will consider building a second one.

This fab will use 130nm to 40nm technologies to produce mixed-signal, power management, and analog products for markets including automotive, industrial, consumer electronics, and mobile terminals. Relevant technology licensing and transfers are expected to come from TSMC. VSMC will commence construction of the first fab in 2H24 , pending approval from relevant regulatory authorities, and it is expected to start mass production in 2027.

Currently, VIS has five 8-inch fabs, respectively located in Taiwan and Singapore. Three of them are based in Hsinchu (Taiwan) and one in Taoyuan (Taiwan). In 2023, the average monthly capacity was about 279,000 8-inch wafers.

On this collaboration with NXP, VIS Chairman Fang Leuh stated that both parties wish to own a 12-inch fab as they currently only have 8-inch fabs. More than half of the new fab’s capacity has already reserved upon long-term commitments from customers, including NXP. He also noted that setting up a fab in Singapore offers several advantages.

Since VIS is held by TSMC, industry experts believe that the establishment of the new VIS fab is driven in part by the need to meet the demands of TSMC’s mature process customers. Mature processes above 90nm account for a small single-digit percentage of TSMC’s revenue but retaining all customers is also necessary to match orders from various manufacturing capacities.

As such, VIS will take over TSMC’s customer orders. Influenced by multiple factors, the order transfer effect is expanding, and VIS has recently received new orders from several customers, like Qualcomm and MPS. That means order transfer effect in 2H24 has become evident.

It is worth noting that Singapore is being seen as a critical hub of the Asian semiconductor industry. It currently boasts a complete semiconductor industry chain, covering design, manufacturing, packaging, test, equipment, materials, and distribution, with more than 300 semiconductor-related companies already established.

According to another report from WeChat account DRAMeXchange, multitudes of semiconductor companies, including Texas Instruments, STMicroelectronics, Infineon, Micron, GlobalFoundries, TSMC, UMC, VIS, and ASE, have set up branches or expanded production in Singapore.

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(Photo credit: VIS)

Currently, the issue of low power consumption remains a key concern in the industry. According to a recent report by the International Energy Agency (IEA), given that an average Google search requires 0.3Wh and each request to OpenAI’s ChatGPT consumes 2.9Wh, the 9 billion searches conducted daily would require an additional 10 terawatt-hours (TWh) of electricity annually. Based on the projected sales of AI servers, AI industry might see exponential growth in 2026, with power consumption needs at least ten times that of last year.

Ahmad Bahai, CTO of Texas Instruments, per a previous report from Business Korea, stated that recently, in addition to the cloud, AI services have also shifted to mobile and PC devices, leading to a surge in power consumption, and hence, this will be a hot topic.

In response to market demands, the industry is actively developing semiconductors with lower power consumption. On memory products, the development of LPDDR and related products such as Low Power Compression Attached Memory Module (LPCAMM) is accelerating. These products are particularly suitable for achieving energy conservation in mobile devices with limited battery capacity. Additionally, the expansion of AI applications in server and automotive fields is driving the increased use of LPDDR to reduce power consumption.

In terms of major companies, Micron, Samsung Electronics, and SK Hynix are speeding up the development of the next generation of LPDDR. Recently, Micron announced the launch of Crucial LPCAMM2. Compared to existing modules, this product is 64% smaller and 58% more power-efficient. As a low-power dedicated packaging module that includes several latest LPDDR products (LPDDR5X), it is a type of LPCAMM. LPCAMM was first introduced by Samsung Electronics last year, and it is expected to enjoy significant market growth this year.

Currently, the Joint Electron Device Engineering Council (JEDEC) plans to complete the development of LPDDR6 specifications within this year. According to industry news cited by the Korean media BusinessKorea, LPDDR6 is expected to start commercialization next year. The industry predicts that LPDDR6’s bandwidth may more than double that of previous generation.

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(Photo credit: SK Hynix)

According to a report from Korean media outlet THE ELEC, a senior executive at analog chip manufacturer Texas Instruments (TI) stated that the company is transitioning its production of gallium nitride (GaN) chips from several 6-inch fabs to 8-inch fabs.

The same report further noted that Jerome Shin, manager of Texas Instruments’ Korean subsidiary, stated at a press conference in Seoul that Texas Instruments is preparing to build 8-inch fabs in Dallas and Aizu, Japan. This move will enable the company to offer more competitively priced GaN chips.

Jerome Shin pointed out that there has been a shift in the perception of GaN chips compared to silicon carbide (SiC) chips since 2022. While GaN chips were previously considered more expensive, this perception is changing because Texas Instruments is transitioning its production from 6-inch fabs to 8-inch fabs. Producing larger wafers means more chips per wafer, leading to increased productivity and lower costs for GaN chips.

Currently, the price of GaN chips is already lower than that of SiC chips. Once the transformation of Texas Instruments’ fabs in Dallas and Aizu, Japan is completed, they will be able to offer even more affordable solutions. Expansion at the Dallas facility is expected to be completed by 2025, although Jerome Shin did not disclose the timetable for the Aizu facility.

However, some industry sources cited in the report suggest that Texas Instruments’ plan may lead to a comprehensive decline in GaN chip prices.

Currently, Texas Instruments is also transitioning the production of power management IC from 8-inch fabs to 12-inch fabs. This move has already resulted in a decrease in the prices of power management chips across the industry.

Still, reportedly, transitioning the production of power management chips from 8-inch fabs to 12-inch fabs could enable Texas Instruments to save over 10% in costs.

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(Photo credit: Texas Instruments)