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Samsung Electronics' Global Tri-lateral Production System Completed with NAND Flash Factory in China
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Samsung Electronics' Global Tri-lateral Production System Completed with NAND Flash Factory in China
  • By matthew
  • May 12, 2014, 09:25
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Samsung Electronics’ semiconductor factory in Gaoxin, Xian, China, opened on May 9.
Samsung Electronics’ semiconductor factory in Gaoxin, Xian, China, opened on May 9.

 

Samsung Electronics launched its mass production of 10-nano NAND flash memory chips after completing its semiconductor factory in Xian, China on May 9.

Building the Xian factory was the largest ever investment for a local company, amounting to US$7 billion. It is also the record amount for any foreign company to invest in China for a single project. 

The tech giant, on the morning of the same day, held the inauguration ceremony, attended by Party Secretary Shanxi Sheng, Korean Ambassador to China Kwon Young-se, and Samsung Electronics CEO Kwon Oh-hyun.

Samsung Electronics CEO Kwon said, “In the past, Xian served a pivotal role in cultural exchange between the West and the East as it was the starting point of the Silk Road. On a similar note, we hope that this place will be a starting point of the 21st Century Digital Silk Road, a fruit born out of cooperation between Korea and China.”

The Xian factory is the company’s first semiconductor manufacturing line established in China.

The company is to wrap up its post process (semiconductor test and packaging) line by the end of the year, to complete a perfect one-stop manufacturing system.

The chipmaking giant will efficiently deal with the market and customers by producing and providing NAND flash products in China, which accounts for 50 percent of the world’s NAND flash demand.

The CEO said, “China produces 80 percent of the PCs that are sold worldwide. Our clients that produce electronics goods in China requested that semiconductor chips be made in China.”

The tech company, upon operating the Xian memory chip factory on the heels of building its factory in Austin, Texas, has now established a “tri-lateral global semiconductor manufacturing system.”

The system aligns system semiconductors focused in the U.S., memory semiconductors focused in China, and Korea that produces and controls all semiconductor products.

The company’s Xian memory semiconductor factory took about 20 months to complete after its groundbreaking ceremony in September 2012. The 1.1 million m2-sized wheat field, equivalent to 100 soccer fields, was transformed to 20 state-of-the-art semiconductor manufacturing buildings and related facilities.

Its annual sales are expected to reach US$5 billion according to the company.

Samsung’s invention V-NAND flash vertically stacks the cells, compared to existing models where information is stored on a single level. Therefore, V-NAND flash gives twice the speed while using half the electricity.

Kim Ki-nam, general manager of the Semiconductor R&D Center at the company, said, “We have been test operating the Xian factory and assessed that its productivity was almost as high as that of Korean factories. The production volume will be flexibly determined by the market status and the demand. Initially, we will produce 70,000 sheets a month in case of 300 mm wafers, but we will get up to speed in the last quarter by producing 100,000 sheets monthly.”

The Chinese government helped with unprecedented enthusiasm when building the factory. It took only 88 days for the company to get the permit after it applied for its Xian factory construction. A Samsung insider let on, “The administrative process that can take as much as one year took three months. This must be a record.”

Similar enthusiasm can be also witnessed in the newly-named “Samsung Road,” the road linking the Xian factory and its adjacent highway.

China, in return of their unsparing support, secured 13,000 jobs. The local chipmaker is to hire 2,000 people at its Xian factory, and 160 affiliates that have current or future presence in Xian will mobilize 11,000 people. On top of this, the global chipmaker, together with its local affiliates in Xian, can secure their future growth drive by establishing a global operating system.

Currently, some 60 local affiliates are in Xian, but they are anticipated to proliferate by as many as 100 in the offing.

Recently, the tech company is expanding more actively overseas than locally.

Last month, it completed its application processor (AP) factory in Austin and its Liquid Crystal Display (LCD) factory in Suzhou, China. Locally, in Hwaseong, Gyeonggi-do, its “Semiconductor Line 17” is under construction, being scheduled to be completed by the end of the year.