The weight of demand for domestic-produced integrated circuits is poised to push China through the 300mm transition phase. Marco Mora, chief operating officer at SMIC, illustrates the peculiarities and opportunities of the market with an intriguing case study.
When IC players such as IBM and Intel began planning for the transition to 300mm manufacturing in the late 1990s, the most advanced Chinese fabs of the time were still manufacturing wafers no larger than 150mm. There was a two-generation gap between the manufacturing capability of China and the rest of the world. Since then, China has narrowed the gap rapidly. This is largely down to strong support from the Chinese government and new advanced fab investments.
In 2004, Semiconductor Manufacturing International Corporation (SMIC) began production at its 300mm wafer fabrication facility in Beijing. This milestone marks China's entry into the advanced 300mm IC manufacturing arena and illustrates the rapid progress its IC industry has made.
The semiconductor industry has shifted to 300mm production for two main reasons: the need for additional capacity and the chance to produce chips at a lower cost per good die.
While the China Center for Information Industry Development projects that China's IC market will climb at a compound annual growth rate of 25% (at least through 2010), it has also stated that domestically supplied ICs can meet less than 20% of the country's overall demand. Such pressure is being fuelled by a growing electronics sector, which Gartner Dataquest forecasts will reach $200bn in revenues by 2007. This eager market's appetite for domestically produced ICs is expected to ensure market growth will continue to outpace that of the world market for some time to come. Finally, there is China's heavy reliance on IC imports – another compelling reason to increase domestic IC manufacturing capacity.
In the capital-intensive IC supply chain, any savings in manufacturing costs can translate into key savings for downstream customers and, ultimately, consumers. Because 300mm wafers have an area 2.25 times larger than 200mm wafers, the manufacturing cost per good die on a 300mm wafer can be as much as 30% lower than for a similar good die produced on a 200mm wafer. Coupled with comparatively lower labour, land and utility costs in China, 300mm manufacturing on fully utilised equipment can provide significant cost savings.
In 2000, while SMIC was constructing its 200mm fabs in Shanghai, some semiconductor companies were already building 300mm fabs outside of China. Two years later, when piling began for SMIC's 300mm wafer fabrication facility in Beijing, experienced vendors helped to construct and equip SMIC's 300mm wafer fabrication facility, allowing SMIC to become the first mover of 300mm manufacturing in China.
Beijing was the natural location for China's first 300mm fab. As the capital city, its political and economic clout has long attracted the presence of both domestic and international companies. And with local top-tier universities such as Tsinghua University and Peking University providing a constant supply of strong engineering graduates, it was only a matter of time before Beijing emerged as a hub for IC design houses and fabless companies. These companies include some of China's top IC design houses in terms of revenue, such as Datang Microelectronics, Beijing Vimicro and Beijing Sigma Microelectronics.
Foundry partners are expected to work closely with customers to meet the latter's needs. So geographic proximity to the customer and design sites will enhance overall communication, simplify supply chain logistics and result in shortened product cycle times. Building an advanced wafer fabrication facility in Beijing further strengthens the region's IC supply chain, promotes closer collaboration with customers and allows the foundry to provide better design and engineering support.
SMIC-Beijing's 300mm facility is based on a tri-fab design. This separates front-end and aluminium metallisation processing from copper back-end processing. Fab 6C will provide metal interconnects for the wafers produced by Fab 4 and Fab 5 and is situated between the two. This distinctive design, also used for the SMIC
200mm fabs in Shanghai, enhances the wafer manufacturing process by physically segregating the copper back-end manufacturing locale to minimise the risks of cross contamination.
A tri-fab design also boasts a built-in opportunity for a new foundry business model based on sole provision of copper back-end manufacturing for advanced logic processes. At present, SMIC's Fab 4 is manufacturing front-end heavy 0.11µ and DRAM process for Infineon and will be used to manufacture 0.10µ DRAM processes for Elpida. Fab 6C will initially be used to run back-end copper processes for customers as part of SMIC's foundry service agreement with Texas Instruments to provide full-flow 90nm logic processing. Fab 5, a logic fab that is currently under construction, will ramp up later according to market demand.
Constructing and operating a 300mm wafer fabrication facility in Beijing presents some unique challenges. As perennial sand storms sweep across the Mongolian deserts to Beijing at least twice a year, special design features were implemented to ensure the buildings, particularly the fabs, would not be infiltrated by sand and dust. Three levels of protection were chosen – sand-trap louvres, auto roll filters, and air filters and washers.
As first barriers, adjustable air inlets take in fresh air and funnel it through sand-trap louvres at high speeds. The sand-trap louvres then change the direction and reduce the velocity of the air, causing the heavy particles to drop. The second level of protection involves auto roll filters, which are automatically deployed depending on air pressure. Rounding out the total solution are pre-filters, bag filters and air washers installed on make-up air units (MAU). Together, these three measures help maintain a Class 100 and Class 1000 air cleanliness standard for the photo-litho and remaining fab areas.
Beijing's limited water capacity and high water and wastewater treatment costs prompted other additions to SMIC's building design. Rainwater collection tanks with a total capacity of 2,600m3 collect and store rainwater for daily operational usage. Additionally, an intricate network of water collection and reclamation systems helps to reclaim cleanroom and industrial water for repeated usage. By the end of 2006, the reclaim ratio of ultra-pure water used in cleanrooms for wafer manufacturing is expected to reach 80%.
Beijing's winter temperature provides opportunities for saving energy. During the cold season, which lasts from November to March, cooling towers provide a 'free' cooling system for chilling operations. All chillers that are normally used to supply the process cooling water system and dry coils, as well as MAUs, can therefore be shut down. The results are significant energy cost savings. Heat is also reclaimed from steam and reused for operational needs.
With a standard 300mm 25-wafer lot and pod weighing approximately 18lb, fab automation was a key issue right from the initial planning and design stages of the construction project.
SMIC-Beijing's 300mm wafer fabrication facility has a design layout that allows for fully integrated fab automation systems. Its state-of-the-art computer integrated manufacturing (CIM) system was based on SMIC's 200mm manufacturing execution system and has additional 300mm functions that include front opening unified pod (FOUP) management, sorter automation, wafer level tracking and multi-lot/recipe in one FOUP. The 300mm CIM system helps the fab maintain high efficiency while keeping costs low.
Having a team of experienced fab personnel that previously worked in 200mm fabs can make the transition to 300mm manufacturing easier, as the two processes share some operational similarities. SMIC's four 200mm wafer fabs in production in Shanghai and Tianjin allow engineers and technicians to gain experience in wafer manufacturing. An increasing number of experienced overseas professionals are also choosing to work in China, taking advantage of the potentials and growth opportunities of the IC industry.
One of the keys to running a successful 300mm manufacturing business is the ability to offer multi-technologies and processes while achieving equal or greater efficiency than 200mm manufacturing. At SMIC-Beijing, although equal or better than 200mm yield has already been reached for some 300mm processes, the stability of the yield remains to be proven through volume production.
The aim is to provide full foundry capabilities for memory, logic and mixed-signal applications using technologies as small as 65nm. To this end, the foundry is expected to qualify for its first process using 0.15µ technology by the end of 2004, with 90nm risk production scheduled to start in the third quarter of 2005. Expectations are that 300mm wafer capacity will increase from 3000 wafers by the end of 2004 to 22,000 wafers by the end of 2005.
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At the initial stage of 300mm manufacturing in China, it is more advantageous for foundries to follow an IDM business model – offering few products in large volumes. But as 300mm manufacturing matures, foundries in China should become more flexible and diverse in their technology offerings.
With increasing pressure to achieve capacity and cost leverages, advanced IC players that have the capital to build an advanced wafer fabrication facility will probably consider establishing a manufacturing base in China and will push the China IC industry ever closer to the forefront of advanced IC technology and manufacturing.