As the semiconductor industry continues to advance, it has sparked an arms race among Samsung, Intel, and TSMC in acquiring extreme ultraviolet (EUV) equipment. When asked about when TSMC would adopt the extremely expensive High Numerical Aperture EUV (High-NA EUV) lithography equipment, as per a report from Economic Daily News, TSMC’s Senior Vice President of Business Development and Global Sales at TSMC, Kevin Zhang, also revealed his insight regarding the matter in an interview.

Reportedly, High-NA EUV machines are priced as high as USD 380 million each, more than double the cost of regular EUV machines. Samsung and Intel have already invested heavily, purchasing several High-NA EUV machines ahead of TSMC, hoping to gain a competitive edge through more advanced equipment.

Industry sources cited by the report point out that Kevin Zhang did not reveal the exact timeline for TSMC’s purchase of High-NA EUV, indicating that TSMC is confident and will not blindly expand its procurement just because competitors have made early purchases. Instead, TSMC will continue to strategically plan its advanced manufacturing processes, steadily preparing to meet upcoming challenges.

Youtube channel TechTechPotato recently uploaded a 29-minute interview with Kevin Zhang. During the interview, Zhang emphasized that TSMC was the very first in terms of bringing EUV into high-volume manufacturing as early as the 7nm generation.

Zhang pointed out that TSMC currently leads in the usage, mass production, and production efficiency of EUV technology. Zhang also mentioned that scalability and manufacturing costs are significant factors to consider. He believes that TSMC’s R&D team will make the best decision regarding when and where to apply the next generation of EUV technology.

Notably, according to a report from The Chosun Daily, it pointed out that TSMC was expected to maximize the capabilities of its existing EUV equipment and utilize them through multi-patterning techniques. Simultaneously, the company was also evaluating the scale at which additional equipment may be introduced.

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(Photo credit: ASML)

Chinese tech giant Huawei, which plans to launch its Mate 70 Series in the fourth quarter, is reportedly to feature the latest Kirin 9100 processor in these models. Though there were rumors indicating that the chip will be manufactured with SMIC’s 5nm node, according to a report by Wccftech, the next Kirin SoC for the Mate 70 Series will still be limited to SMIC’s 7nm process.

Kirin 9100’s predecessors, the Kirin 9000S and the Kirin 9010, have been mass-produced using SMIC’s 7nm (N+2) technology, the report notes. As market speculations previously indicated that Huawei might use 5nm in its next Kirin SoC, there seems to be a twist in Huawei’s plans.

According to Wccftech, the next Kirin SoC for the Mate 70 series will likely be mass-produced using SMIC’s N+3 process, which offers higher density compared to the N+2 variant. The move means that instead of transitioning to SMIC’s 5nm, Huawei’s latest Kirin SoC may choose to stay with 7nm.

It is worth noting that even under the U.S. export control, SMIC is said to successfully produce 5nm chips using DUV lithography instead of EUV, which is typically required for 5nm production. However, as the high cost and low yield of DUV make it a challenging feat for most manufacturers, Huawei’s decision may be practical.

As previously reported by the Financial Times, industry sources have indicated that SMIC’s prices for 5nm and 7nm processes are 40% to 50% higher than TSMC’s, while the yield less than one-third of TSMC’s. Later, it was estimated that SMIC’s 5nm chip prices would be up to 50 percent more expensive than TSMC’s on the same lithography, meaning that Huawei would face a tough time selling its Mate 70 series to consumers with a decent margin if it attempts to absorb a majority of those component costs.

Therefore, Wccftech now states that the Kirin 9100 might be fabricated using the 7nm process. By employing the N+3 node, it could achieve a higher density than the Kirin 9010 and the Kirin 9000S, which are manufactured by the N+2 node. This improvement means that the Kirin 9100 will have a higher transistor count, leading to better performance per watt and improved power efficiency.

Alongside the new chipset for the Mate 70 family, Huawei is rumored to be testing the same N+3 technology for its ARM-based hardware, the report notes.

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• [News] Huawei Reportedly to Launch Kirin 9100 with Superior Performance to Snapdragon 8 Gen 2
• [News] SMIC Reportedly to Manufacture 5nm Chips for Huawei Without EUV Machinery

(Photo credit: Hisilison)

While TSMC is pushing forward with its 2nm fab in Taiwan, there is also good news about its overseas expansion. According to the Japanese newspaper “Kumanichi,” TSMC is expected to announce the construction of its Kumamoto Fab 2 in Japan on February 6, with the possibility of incorporating the 7nm process. Additionally, the United States is also expected to provide several billion dollars in subsidies to TSMC’s new fab by the end of March.

▲ TSMC’s Layout of Global Production Capacity Edited by TrendForce, January, 2024

Per the report from the ” Kumanichi,” Japan’s Minister of Agriculture, Forestry, and Fisheries, Tetsushi Sakamoto, who hails from Kumamoto, stated during a local meeting on January 28th that TSMC is evaluating Kumamoto Prefecture’s Kikuyo Town as the location for its second fab. The announcement of the site for Fab 2 in Kumamoto is expected to be made as early as February 6th.

The report further indicates that Fab 2 is expected to be situated next to the first fab, which was completed at the end of last year. TSMC had previously mentioned that if a second fab were to be constructed, it would be located in the vicinity of the existing facility under construction.

Regarding the rumors, the spokesperson for TSMC stated that the expansion strategy of TSMC’s global manufacturing footprint is based on considerations of customer demand, business opportunities, operational efficiency, government support, and economic costs.

Through necessary investments, TSMC continues to support customer demands and respond to the structural growth of semiconductor technology in the long term. “We are currently focusing on evaluating the possibility of setting up a second fab in Japan, and there is no further information to share at the moment.”

During the recent earnings call, Mark Liu also mentioned that the plan for TSMC’s second fab in Japan is still under evaluation. However, he hinted at the possibility of adopting the 7-nanometer process.

TSMC’s Kumamoto plant is scheduled to hold its opening ceremony on February 24th. After retiring following the shareholders’ meeting in June this year, TSMC Chairman Mark Liu, along with the designated successor and current President C.C.Wei, will lead several top executives to Japan for the event. TSMC has also invited Japanese Prime Minister Fumio Kishida to attend.

The decision for TSMC to establish a plant in Kumamoto, Japan, was announced in October 2021, and construction began in 2022. In comparison to TSMC’s announcement of a plant in the United States in 2020, which faced delays and is set to commence production in 2025, the Japanese plant has advanced more swiftly.

This aligns with TSMC founder Morris Chang’s statement last year that Japan is considered an ideal location for establishing a semiconductor supply chain.

Analyst Joanne Chiao from TrendForce previously pointed out that Japan’s expertise in materials and machinery is one of the factors attracting TSMC’s expansion. Japan stands to benefit from TSMC’s establishment as the pace of creating a local semiconductor ecosystem by Japanese government surpasses that of the U.S. government.

On the other hand, despite TSMC delaying the production at its new US plant, according to Bloomberg, the United States plans to announce substantial chip subsidies by the end of March. The aim is to pave the way for chip manufacturers like TSMC and Intel by providing them with billions of dollars to accelerate the expansion of domestic chip production.

These subsidies are a core component of the US 2022 “CHIPS and Science Act,” which allocates a budget of USD 39 billion to directly subsidize and revitalize American manufacturing.

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• [News] Completion of TSMC’s Kumamoto Plant, Grand Opening on 2/24
• [News] Rumored to Build Third Plant in Kumamoto, TSMC: Currently Focusing on Assessing the Construction of a Second Plant

(Photo credit: TSMC)

According to Taiwan’s Economic Daily, after disassembling Huawei’s Mate 60 Pro smartphone, it has been revealed that the chips, including the Kirin 9000S, are produced by China’s semiconductor foundry, SMIC, using their advanced 7-nanometer process. This development has brought attention to SMIC’s manufacturing capabilities. Recently, it has been reported that SMIC has placed a substantial order with Taiwanese suppliers in the supply chain, equivalent to approximately two years’ worth of demand, and is urging swift delivery.

While SMIC has established itself in mature semiconductor manufacturing processes and serves not only domestic IC design companies but also many Taiwanese IC design firms, it has been actively trying to catch up with foreign giants in advanced manufacturing processes. Additionally, limitations in acquiring equipment like EUV have constrained its progress, making its achievements in the 7-nanometer process a noteworthy accomplishment.

In light of these developments, it has been reported that SMIC has approached Taiwanese partner companies to secure a substantial supply of specific products for an estimated two-year period, likely to be used in their advanced 7-nanometer manufacturing process. SMIC is hoping for proactive cooperation from its supply chain partners to ensure prompt delivery.

(Photo credit: SMIC)