China has taken a big step in its push into the memory IC industry. Three major Chinese companies are getting ready for trial production of DRAMs and NAND flash in the second half of 2018. YMTC, Innotron (Hefei Chang Xin) and JHICC are scheduled to start trial production of NAND Flash, mobile DRAM and specialty DRAM, respectively, in the second half of 2018, according to DRAMeXchange, a division of TrendForce. Mass production will follow in the first half of 2019, marking China’s first domestic chip production.
Equipment was installed at Innotron’s fab in the third quarter (Q3) of 2017, according to DRAMeXchange, but the company has postponed trial production until Q3 2018, which will be followed by mass production in the first half (1H) of 2019.
JHICC, focused on specialty DRAM, also postponed its trial production until Q3 2018 and mass production until 1H 2019. The company announced its plan in July 2016 to invest $5.3 billion in a new 12-inch wafer fab in Jinjiang, Fujian Province.
Both Innotron and JHICC are behind in their announced schedules, DRAMeXchange reported.
Innotron may face other challenges. Industry watchers don’t think Chinese memory IC makers will be able to develop advanced technology without infringing on patents or forming a joint venture partnership.
“Innotron apparently wants to compete head to head with top DRAM suppliers by choosing LPDDR4 8Gb chips as its first product, but there is a strong possibility that Innotron will have potential issues of patent infringement,” said DRAMeXchange. “To avoid arguments, Innotron will need to accrue IPs that are recognized by the international laws. Another safer approach is to sell products only in the domestic market at the outset.”
Samsung’s capex spending levels will put a stop to “any hopes that Chinese companies may have of becoming significant players in the 3D NAND flash or DRAM markets,” and “just about guarantees that without some type of joint venture with a large existing memory suppler, new Chinese memory startups stand little chance of competing on the same level as today’s leading suppliers,” Bill McLean, president of IC Insights, said last year.
“Even if they were to develop advanced technology on their own, the new Chinese suppliers would almost certainly infringe upon numerous DRAM and NAND patents held by Samsung, SK Hynix, Micron, etc.,” he added.
In the NAND flash segment, YMTC plans to build three 3D-NAND flash manufacturing plants sequentially in three phases. The first-phase was completed in September 2017 with equipment installation scheduled in the third quarter of 2018, followed by trial production in the fourth quarter, said DRAMeXchange. The plant will manufacture 32-layer MLC 3D-NAND Flash. Wafer starts aren’t expected to exceed 10,000 per month.
“The construction of the second- and third-phase plants and their production plans will proceed according to the situation after YMTC perfects its 64-layer design,” said DRAMeXchange.
