Amid global chip shortages, China’s largest chipmaker—facing a U.S. blacklist—struggles to acquire advanced chipmaking equipment and technology, and to meet the high global demand, it is rapidly expanding existing production lines but cutting its R&D investment and personnel.
On Sept. 3, Semiconductor Manufacturing International Corp. (SMIC) announced that Zhou Zixue, the company’s chairman, resigned citing personal health reasons. On the same day, SMIC also announced its plans to build a factory in Shanghai to expand its production capacity.
According to the announcement, Zhou Zixue will continue to serve as the company’s executive director. Meanwhile, SMIC chief financial officer Gao Yonggang has taken on the additional role of acting chairman. SMIC emphasized that Zhou has no disagreement with the company or its board and that its company shareholders should not be concerned, according to its filing.
Zhou became the chairman and executive director of SMIC in March 2015. In October 2017, Zhou poached Liang Mong-song, a former senior R&D director of Taiwan Semiconductor Manufacturing Company (TSMC), to join SMIC. TSMC is currently the world’s largest and most advanced chipmaker. During his tenure, Zhou continued to promote SMIC’s sprint for advanced Integrated Circuit (IC) manufacturing processes below 14nm.
In semiconductor fabrication, the smaller the process technology, the more advanced the chip will be. The smaller the technology node, the higher the transistor density and the lower the chip power consumption, resulting in higher performance. However, the smaller manufacturing process requires more advanced material and production technology and a greater cost of R&D and production lines.
Currently, only TSMC, Samsung, and Intel possess manufacturing processes below 10 nanometers. After Zhou poached Liang in October 2017, SMIC announced its mass production of 14-nm chips in the fourth quarter of 2019, becoming the first company in China to possess the advanced 14-nm IC manufacturing process.