Just to be factual, China outside of Taiwan still lacks the ability/technology to fab a modern microprocessor using a competitive process. Fab technology is incredibly restricted, not just by governments but the companies themselves.
China doesn't export CPU processors, they import from Intel like everyone else. I believe there is a fab in Singapore, but I'm not sure what generation they are at. There is a testing facility in chengdu, at least.
I believe your Intel example has very little to do with the cost or quality of manufacturing in China and more to do with export restrictions on current generation semiconductor fab equipment. Intel does operate a fab in China but is based on an older 65nm process.
Intel has always fabbed its high-IP parts in the USA or strongly allied countries (Israel, Ireland). They will never put a fab in China because the Chinese will rip off all their IP. The fact that Intel has resumed construction of a half-completed facility in the same town where they make almost everything else is not really news.
Does China actually have that many fabs? I used to work in the semi industry and I never heard of anyone going to China for customer support, even for older tech. Taiwan and Korea led the industry.
There is nothing inherently special about Taiwan for chip manufacturing. Theoretically, Europe and the US can (and do, to some extent) challenge TSMC and China aspires to do so too.
The fundamental problem is that it is extraordinarily expensive to build a state of the art chip fab and it is extraordinarily difficult to make start of the art chips (process technology in the 7nm node range). The technology is heavily patented and, what isn't patented, is tightly controlled as trade secrets by fabs.
TSMC[1] started as a contract fab house with competent, but not state of the art, fab capabilities. Over time and with immense investments, they have become a leading (arguably the leading) fab. Intel is on par (arguably) or has fallen slightly behind TSMC in terms of state of the art fab capabilities. Global Foundries[2] (made up of former IBM foundries[3], Motorola foundries, and others, acquired by AMD and subsequently spun out) has fallen behind in terms of state of the art (e.g. 7nm nodes). Europe also has quite a few competent, but not state of the art, foundaries.
There are a ton of fabs that were state of the art but have not been upgraded - they are quietly fabbing billions of chips that don't need smaller geometry fab nodes and cannot justify the expense of moving to more state of the art fabs. "Moving" to a new fab node technology requires a significant redesign of the chip and would require requalifying, both of which are very expensive.
You still got the top 2 in Taiwan and Korea, so they won't be able to produce iPhones or Macbooks. But the rest is there already. Even Samsung has a few fabs in China.
We were talking about a packaging plant, not a fab. Edit: I understand it may be confusing, as the thread started with Intel doing packaging at Chengdu but moved onto the broader manufacturing question. But the foreign fabs mostly are Asian owned (Taiwan and South Korea) and have little to do Intel.
Intel doesn't have any fabs in China, the Dalian facility is for NAND and was sold to SK Hynix recently. Shanghai/Chengdu are assembly/test.
It's just Chinese politics, and a very large market. It was a huge mistake to use the term 'Xinjiang', one that other companies like Apple are careful to avoid.
Why China? Most of the major chip fabs aren't made in China. They're mostly made in Taiwan, South Korea and the US. Unless we're strictly talking about TSMC, which does have 2/18 fabs in China.
China doesn't export CPU processors, they import from Intel like everyone else. I believe there is a fab in Singapore, but I'm not sure what generation they are at. There is a testing facility in chengdu, at least.
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