Wuhan Hongxin stalled last year due to funding difficulties and other issues, becoming a typical unfinished semiconductor project in recent years. A few days ago, this project was exposed by the media that there is no hope of resuming work. The company’s senior management has notified all employees on February 26 that they must apply for resignation before leaving get off work on February 28 and complete the resignation procedures before March 5.
In response to this matter, Gao Qiquan, former global executive vice president of Ziguang Group and known as the “Godfather of Taiwan DRAM”, believes that this has long been expected. In an interview with Taiwanese media “Economic Daily” on February 27, he said that after China has turned to strict control of semiconductor manufacturing investment from 2020, there will be no more unfinished semiconductor projects such as Wuhan Hongxin, which is tantamount to announcing that semiconductor projects are unfinished. The end.
Screenshot of Taiwan media report
100 billion unfinished project ended
Wuhan Hongxin has been stagnated due to funding difficulties for more than half a year.
On February 26, industry media Jiwei reported citing people familiar with the matter, that the senior executives of Hongxin informed in the internal group: “Combined with the current situation of the company, the company has no plan to resume work and production. After the company’s research and decision, all employees are requested to do so in February 2021. Apply for resignation before the end of work on the 28th, and complete the resignation procedures before the end of work on March 5, 2021; leave personnel can apply online. “There are 240 people in the internal group, which means that Hongxin still has at least 240 employees are on duty. As for whether there is severance compensation, it is not yet known.
Wuhan Hongxin was established in November 2017. At that time, it claimed to have invested 128 billion yuan in foreign countries. It was selected as a major project in Hubei Province twice in 2018 and 2019. According to the project plan, Wuhan Hongxin expects to build three production lines: a 14nm logic process production line with a total capacity of 30,000 pieces per month; a logic process production line below 7nm with a total capacity of 30,000 pieces per month; and a wafer-level advanced packaging production line.
Official website screenshot
The official website disclosed that Wuhan Hongxin 14nm independent technology research and development project has been launched in March 2019, and plans to start the first test of the film in the second half of 2020; the independent technology research and development of 7nm will start in 2020, and the goal is to start in the third quarter of 2021. First test film streaming.
However, the project did not progress as planned. After the government advances funds, the follow-up funds for the project are difficult to sustain. According to the “Wuhan City Major Project Plan in 2020”, as of the end of 2019, Wuhan Hongxin has completed an investment of 15.3 billion yuan, and the investment in 2020 is expected to be 8.7 billion yuan. .
In 2020, Wuhan Hongxin was kicked out of a major project in Hubei Province, but it is still listed as a major project in Wuhan.
The main reason for the financial difficulties is that several shareholders have generally shrunk in their capital contributions. Take Beijing Guangliang Blueprint Technology Co., Ltd., the major shareholder, as an example, the paid-up capital is 0. In this case, once the government’s investment is used up, it is not surprising that there will be problems with funds.
On July 30, 2020, the People’s Government of Dongxihu District of Wuhan City officially released the report “Analysis of Economic Operation in the Field of Investment and Construction in Dongxihu District in the First Half of the Year”, which clearly pointed out that the Hongxin project “has a large funding gap, and it is facing the rupture of the capital chain at any time, leading to the stagnation of the project. risk”.
The analysis report also pointed out that the land for Hongxin Phase II has not been adjusted and transferred, and the project lacks supporting materials such as land and environmental assessment, and cannot be reported to the National Development and Reform Commission window guidance, resulting in the failure of the National Semiconductor Fund and other equity funds to be imported.
Before the release of the above report, Jiang Shangyi, CEO of Wuhan Hongxin Project, had already retired. In November 2020, Jiang Shangyi issued a lawyer letter stating that he had resigned from Wuhan Hongxin’s director, general manager, and chief executive officer positions in June of that year, and Hongxin had also accepted his resignation.
Later, Jiang Shangyi said in an interview, “My experience at Hongxin was a nightmare.”
According to Qixinbao information, on November 18, 2020, Wuhan Hongxin’s 90% shareholder Beijing Guangliang Blueprint Technology Co., Ltd. withdrew, Wuhan Xingong Technology Development Co., Ltd. became the 100% controlling shareholder of Wuhan Hongxin, and Wuhan Xingong The Science and Technology Development Co., Ltd. is 100% owned by the State-owned Assets Supervision and Administration Bureau of the People’s Government of Dongxihu District, Wuhan. From the outside, this means that the Wuhan Hongxin project has been officially taken over.
Observer.com found that the official website of Wuhan Hongxin could not be opened at present.
Screenshot of Qixinbao
“Hongxin draws an end to the unfinished project”
Regarding the official takeover of the Wuhan Hongxin project, on February 26, Gao Qiquan, who has left the global executive vice president of Ziguang Group, said that Wuhan Hongxin claimed that the total investment exceeded 100 billion yuan, but the funds were not all in place and could only be carried out. The plant construction project with the smallest cost.
Gao Qiquan is known by the industry as the “Godfather of Taiwan’s DRAM”. In 2015, he signed a five-year contract with Ziguang Group. The island believes that its influence is greater than that of Zhang Rujing’s founding of SMIC (00981). With the expiration of the 5-year contract, Gao Qiquan announced that he would leave Ziguang Group in October 2020.
In an interview with Taiwanese media, Gao Qiquan said that since mainland China has strictly controlled semiconductor manufacturing investment projects last year, it must be confirmed that funds are in place and product technology is in place before the project is allowed to start looking for talents, which means that Hongxin has completed the mainland semiconductor project. The event was brought to an end.
Gao Qiquan Picture source: Taiwan’s “Economic Daily”
In fact, before Wuhan Hongxin, there were problems in many domestic semiconductor investment projects. Tie Liu, a columnist for Science and Industry Force, once pointed out that in recent years, with the chip boom set off across the country, a large number of domestic and foreign companies have drawn big cakes and invested in enclosures across the country. Some local governments have disregarded local realities and are greedy. Foreign countries are fast going, and many projects have been thundered, such as Nanjing Dekema, Chengdu Global Foundry, Huaxintong and so on.
Tie Liu pointed out in the article that the biggest lesson of the semiconductor industry’s Great Leap Forward is to respect the law of technological development, and that technological development should be gradual. Local governments should not try to use short-term policies and state-owned capital to get fat in one go, or use administrative resources in the short term. industry.
In October last year, Huang Libin, spokesperson for the Ministry of Industry and Information Technology of China and director of the Operation Monitoring and Coordination Bureau, said that my country’s semiconductor industry is in a stage of accelerating development, and the enthusiasm of all sectors of society to participate in development is very high. In the “Policies for Promoting the High-quality Development of the Integrated Circuit Industry and Software Industry in the New Era” (hereinafter referred to as “Policies”) issued and implemented by the State Council, it is clearly stated that orderly guiding and standardizing the development order of the integrated circuit industry, and planning and layout.
“In the next step, the Ministry of Industry and Information Technology will do a good job in the implementation of the “Several Policies”, optimize and improve the development environment of the integrated circuit industry, strengthen the collaborative innovation of the upstream and downstream of the industrial chain, strengthen the protection of intellectual property rights, promote the free flow of factor resources, and create a fair and just market environment. , To promote the healthy development of the integrated circuit industry.” He said.
As for “chip projects unfinished” frequently appeared in the newspapers, the National Development and Reform Commission spokesperson Meng Wei also responded in October last year and pointed out: “We have also noticed that the enthusiasm for domestic investment in the integrated circuit industry is constantly rising, and some have no experience and technology. , “Three-nos” enterprises with no talents are engaged in the integrated circuit industry, and individual places do not have enough understanding of the law of integrated circuit development, blindly start projects, low-level repeated construction risks appear, and even some projects have stagnated and workshops are vacant, resulting in waste of resources. ”
Meng Wei said that in response to the current chaos in the chip industry, the National Development and Reform Commission will focus on four areas in the next step: First, strengthen services and guidance for the construction of major integrated circuit projects, and do a good job of planning and layout; second, speed up the implementation of the new era Several policies to promote the high-quality development of the integrated circuit industry and the software industry should promptly introduce supporting measures; the third is to establish a long-term working mechanism of “early combing, early detection, early feedback, and early disposal” to reduce investment risks in major integrated circuit projects; In accordance with the principle of “who supports, who is responsible”, those who cause major losses or trigger major risks shall be notified and held accountable.