State-backed HSMC, which eyes to compete with TSMC and Samsung, experiences capital chain rupture

Taiwan News
Date: 2020/09/10
By: Sophia Yang, Taiwan News, Staff Writer

TAIPEI (Taiwan News) — An ambitious semiconductor project in the central Chinese city of Wuhan with planned investment of about US$20 billion and a management team of former Taiwan Semiconductor Manufacturing Company (TSMC) executives has been stalled amid a failure to attract more investors.

Launched in 2017, Wuhan Hongxin Semiconductor (HSMC) was said to have poached TSMC senior engineers and managers by offering large financial incentives, as high as 2.5 times TSMC's total annual salary and bonus package. Techbang reported the Chinese company has been seeking to recruit TSMC engineers familiar with 7 nanometer (nm) process manufacturing since 2019.

However, Hongxin CEO Chiang Shang-yi (蔣尚義), TSMC's former Chief Operating Officer, was said to be contemplating quitting the project in June, but later the company dismissed those reports as rumors. The company is facing strong headwinds as it becomes more difficult to obtain advanced U.S. equipment for manufacturing chips amid US-China trade disputes.
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