These seven wafer fabs may be delayed in construction this year

In the past two years, the semiconductor industry has been affected by various factors such as lower than expected market recovery in the downward cycle and tight funds. Intel, TSMC, Samsung, and other large factories are continuously adjusting and slowing down the construction speed and pace of wafer fabs to better serve the long-term development goals of the enterprise while maintaining the trend of expanding production. According to incomplete statistics from Global Semiconductor Watch, since the first half of this year, the construction of two factories, Intel's 1nm chip factory in Germany and the Ohio factory in the United States, Samsung's Pingze chip factory in South Korea and Taylor wafer factory in the United States have been delayed, and TSMC's two factories in Arizona have been delayed in production. In addition, the construction of Wolfspeed Germany's 8-inch SiC wafer factory may be postponed until 2025.

Delayed construction of Intel's 1nm chip factory in Germany and Ohio, USA

According to foreign media reports, Intel's construction of Fab 29.1 and Fab 29.2 near Magdeburg, Germany has been postponed due to pending EU subsidy approval and the need to remove black soil and reuse it. The start of construction has been postponed from the summer of 2024 to May 2025.

Previously, it was reported that the construction plan for the chip factory initially began in the first half of 2023, but due to delayed subsidies, the construction was postponed until the summer of 2024. To this end, German Finance Minister Michael Richter is vigorously pushing to ensure that Intel receives the necessary funding. In 2023, the federal government approved a national aid worth 9.9 billion euros as a project subsidy for Intel worth 30 billion euros, but this is yet to be confirmed by the European Union.

In addition, the topsoil on the construction site cannot be removed until May 2025 at the earliest. It is reported that Intel's future construction sites contain high-quality black soil, which must be carefully removed and reused in accordance with legal regulations. The state government will be responsible for removing 40 centimeters of soil from the surface, while Intel will be responsible for removing additional soil beyond this depth.

It is reported that Intel's Fab 29.1 and Fab 29.2 were originally planned to start operation by the end of 2027, or will adopt very advanced manufacturing processes, which may be Intel 14A (1.4nm) and Intel 10A (1nm) process nodes. But Intel now estimates that it will take four to five years to build these two factories, so production will begin from 2029 to 2030.

According to official Intel news, the suffix "A" in the Intel node naming convention represents angstrom, with 10 angstroms converted to 1 nanometer. Intel has not yet disclosed any details about the 10A/1nm nodes, but has informed us that it categorizes the new nodes as having at least two digit power consumption/performance improvements. Intel CEO Pat Gelsinger told us that the improvement rate for the new node is approximately 14% to 15%, so we can expect the 10A node to have at least the same level of improvement as the 14A node.

In addition, according to foreign media reports in February this year, due to sluggish market demand and delayed subsidies in the United States, Intel has postponed a $20 billion chip project in Ohio, USA.

In January 2022, Intel announced plans for an initial investment of over $20 billion to build two new cutting-edge wafer fabs in Lijin County, Ohio. The plan starts chip manufacturing in 2025. Due to various factors, according to personnel involved in the project, the Fab1 and Fab2 factories of the Ohio One project are currently being launched and will be completed between 2026 and 2027, and will be officially put into operation around 2027 and 2028.

Samsung Korea's Pingze Chip Factory and US Taylor Wafer Factory Delayed

In February this year, Samsung revealed that it had partially halted the construction of its fifth semiconductor factory located in Pyeongsa City, Gyeonggi Province.

It is reported that Pingze Park is the semiconductor base of Samsung Electronics, covering memory and system semiconductors, chip design, production, and post-processing. Samsung Electronics originally planned to build six semiconductor factories on a site of 855000 square meters in Pingze Park, creating the world's largest semiconductor center. At present, the P1, P2, and P3 factories in Pingze Park have the most advanced DRAM, NAND flash memory, and OEM production lines, while the construction of the P4 and P5 factories is underway.

Samsung Electronics stated at the time that the shutdown was for further inspection. However, industry insiders have revealed that Samsung is adjusting its P4 and P5 wafer fab's new production lines in order to prioritize the construction of P4's PH2 production line. It is reported that P4 factory may build a PH3 production line to produce high-end DRAM and other products to meet market demand.

In addition, according to foreign media reports, Samsung's factory in Texas, USA has also been delayed. It is reported that Samsung Electronics has postponed the mass production of wafers located in Taylor, Texas, USA from the end of 2024 to 2026, possibly due to adjustments in construction speed due to the slowing growth of the wafer foundry market. The delay is caused by issues related to US government subsidies and various licensing complexities. The uncertainty of economic recovery seems to have also affected Samsung Electronics' investment decisions in the region.

It is reported that the Samsung Taylor wafer fab project began in the first half of 2022 and was originally planned for mass production in the second half of 2024, mainly focusing on 4nm chips. At the end of December 2023, Cui Shiyong, President of Samsung Electronics Manufacturing (Chip Manufacturing) Business, stated at the IEDM 2023 in the United States that the Taylor factory will begin its first manufacturing service in the second half of 2024 and begin mass production in 2025, indicating that the investment plan has been adjusted. And, according to the latest news from foreign media in January this year, Samsung Electronics was originally scheduled to install equipment at the Taylor wafer factory by the end of 2023. Now, the installation plan has been postponed to the first half of 2024, which may further delay the mass production time.

TSMC Delays Production of Two Factories in Arizona, USA

On April 9th, TSMC announced on its official website that it plans to build a third wafer fab in Arizona. After completion, it will use 2nm or more advanced process technology to contract wafers for customers. The total capital expenditure in Phoenix, Arizona will also exceed $65 billion.

At the same time, the industry has also noticed that TSMC's first and second wafer fabs in Arizona have been delayed from their initial plans.

On its official website, TSMC disclosed that their first wafer factory in Arizona is progressing to production in the first half of 2025, using a 4nm process to manufacture wafers for related customers; In addition to the previously announced 3nm process technology, the second one will also add more advanced 2nm process technology and will begin mass production in 2028.

When it was announced on May 15, 2020 that a wafer fab would be built in Arizona, TSMC planned to start construction in 2021 with a target production date of 2024. On December 6, 2022, TSMC announced that its factory's process technology had been upgraded from the previously planned 5nm to 4nm, but they still stated that they plan to mass produce in 2024.

The second wafer factory in Arizona announced in December 2020 that it was originally scheduled to mass produce wafers in 2026, mainly using the 3nm process technology to contract wafers for customers. The latest disclosure of 2028 has been delayed by nearly two years compared to the original plan.

For the third wafer fab planned to be built in Arizona, TSMC has not yet disclosed the start date, but they mentioned using 2nm or more advanced process technology and plan to start production in the late 1930s.

Wolfspeed Germany's 8-inch SiC wafer factory may be delayed until 2025 for construction

The German 8-inch SiC wafer factory, jointly invested and constructed by Wolfspeed and ZF, has also been delayed in construction this year.

In February 2023, Wolfspeed announced the establishment of a strategic partnership with ZF Group. Both sides plan to establish a joint innovation laboratory to promote the progress of silicon carbide system and equipment technology in the fields of transportation, industry, and energy applications. This strategic partnership also includes a major investment from ZF to support the construction of the world's largest and most advanced 200mm silicon carbide wafer factory in Ensdorf, Germany.

It is reported that the 8-inch SiC wafer plant planned to be located in Ensdorf, Saarland, will be led by Wolfspeed and is expected to cost approximately 2.75 billion euros (approximately 21.5 billion RMB). It has received subsidies of 360 million euros (approximately 2.8 billion RMB) from the German federal government and 155 million euros (approximately 1.2 billion RMB) from the Saarland government. Wolfspeed is still applying for funding assistance under the European Chip Act. ZF will provide hundreds of millions of dollars in financial investment to Wolfspeed in exchange for a minority stake in the factory.

Sources have revealed that Wolfspeed hopes to receive more funding before the groundbreaking ceremony, and if assistance cannot be obtained from the bill, the project is highly likely to be delayed. The factory was originally planned to start construction in the summer of 2024, but according to Wolfspeed CEO Gregg Lowe, construction may not start until 2025.