Wuxi: China's Ambitious Push for Chiplets in the Heart of the Semiconductor Industry

Friday - February 9 2024, 10:35 UTC - 9 months ago

Wuxi, a medium-sized city in China, has a long-standing history in the semiconductor industry and is home to over 600 chip companies. With a focus on chip packaging, particularly chiplets, Wuxi has announced its plan to become the 'Chiplet Valley' and is heavily investing in this technology to gain an advantage in the semiconductor industry. In other news, China is leveraging its few strengths in the face of increasing tensions with other countries and has invited US mayors to visit in hopes of finding local support outside of Washington politics.

The semiconductor industry is constantly seeking ways to improve chip performance while keeping costs under control. Outside China, one of the alternative routes being explored is chiplets, which involves separating the functions of a chip into smaller devices instead of trying to cram more transistors into one chip. This approach has already been successfully implemented by companies like Apple and Intel. While the technology behind chiplets is not new, it has gained more significance in recent years, especially for Chinese tech giant Huawei, which has faced strict sanctions from the US and is unable to work with foreign factories. In fact, Wuxi, a medium-sized city in China, has become a key player in the development of chiplets.

Located between Shanghai and Nanjing, Wuxi has a strong manufacturing industry and has a long history in the semiconductor sector. In the 1960s, the Chinese government built a state-owned wafer factory there, and in 1989, 75% of the state budget was allocated towards the factory's development. Fast forward to 2022, and Wuxi is home to over 600 chip companies, making it the third-largest city in China for the semiconductor industry, behind only Shanghai and Beijing.

But what sets Wuxi apart is its focus on chip packaging – the final steps in the assembly process, including integrating the silicon part with its plastic case and testing the chip's performance. The third-largest chip packaging company in the world, JCET, was founded in Wuxi more than fifty years ago. And in 2023, the city announced its plan to become the 'Chiplet Valley.' A $14 million subsidy has been allocated to support companies developing chiplets in the region, and the Wuxi Institute of Interconnect Technology has been formed to drive research efforts in this area.

While chiplets have gained attention, other advancements in packaging techniques also present opportunities for chip packaging to take center stage again. And China is making a bet on that possibility, leveraging one of its few strengths in the semiconductor industry to gain an advantage. In fact, Wuxi's ambitious plan to become the 'Chiplet Valley' is part of a broader effort to catch up with countries leading in this field, such as the US.

In other news related to China, TikTok's CEO, Shou Zi Chew, recently testified in front of the US Senate on social media's exploitation of children, along with the CEOs of Meta, Twitter, Snap, and Discord. Mayors from the US heartland are also being invited to visit China, as the country hopes to find local support outside of Washington politics. And in the East China Sea, tensions are rising as more spy planes from democracies patrol the region to keep an eye on China.