This is certainly an experience that Shanghai chip people will never forget.
As the COVID-19 pandemic ravages Pudong and Puxi, Nanjing Road, which has undergone a century of changes, is a rare witness to the empty scene.
The whole of Shanghai is working hard to fight the epidemic. In many corners of Pudong, groups of chip industry practitioners have taken action to fight the epidemic and ensure production. China's "core" is dirty, and we cannot let China's "core" be "lacking".
More than 6000 employees of Huahong Group take the factory as their home to ensure "no production stop, continuous supply"; More than 500 employees of Shanghai Silicon Industry co., LTD. (688126.SH) provided supplies against COVID-19 to ensure that the fabs had "rice to spare"; Even many employees of chip design companies who work from home also sign up to be volunteers in their communities during their work breaks.
However, under the impact of the epidemic, Chip companies in Shanghai are also in urgent need of more support in logistics and the entry and exit of some personnel.
Stick to the production line chip warrior
Shanghai is China's dirty core. In the field of chip manufacturing, there are smIC (688981.SH), Huahong Group and other giants; In the field of chip design, unigarui, Weil (603501.SH), Fudan Microelectric (688385.sh), Gekwei (688728.SH) and other sub-field leaders. There are also chip IP company Xinyuan (688521.SH), semiconductor materials and equipment company Shanghai Silicon Industry, Zhongwei (688012.SH), and Semmei Shanghai (688082.sh).
Data from Minsheng Electronics shows that the output value of integrated circuits in Shanghai accounts for about 23% of the national total, with design industry accounting for 25%, manufacturing industry for 18% and packaging and testing industry for 17%. The importance of Shanghai in China's chip industry can be seen. When the epidemic hit, can Shanghai's chip industry chain still operate normally?
In fact, Shanghai's chip companies are already on the move.
Pudong, home to most of Shanghai's chip companies, was one of the first areas in the city to be seized.
On the evening of March 27, while many Shanghai residents were still buying up supplies in supermarkets, the employees of major chip manufacturing companies were racing against time to get back to their companies.
"Thousands of Huahong residents threw away bowls and chopsticks and put their clothes and toiletries in suitcases...... in just two hours," the company said Bearing the worries and concerns of their families and carrying the thoughts and guilt of their families, huahong people drove back to the factory area and gathered to the department to start the 'core' life of more than 6,000 warriors stationed in the factories at the moment before pudong closed.
Photo source: Official wechat of Huahong Group
Lu Bin (pseudonym), a Shanghai-based chip industry insider, told The National Business Daily: "As far as I know, smIC (International), for example, had some of its production staff completely moved into the factory before pudong lockdown, and most of them were male."
In fact, men are not the only ones stationed there. In one department of Huahong Group, "five most beautiful mothers" left their babies and rushed back to work. Even a pregnant female employee rushed to work from Puxi overnight.
"Semiconductor equipment cannot be shut down, otherwise the loss will be huge," Zhang Guobin, CEO of Electronic Innovation Network, told The National Business Daily. At present smIC, Hua Hong has not broken out big diagnosis information. Due to closed-loop management and on-site production measures, there was no major impact."
Although a large number of chip manufacturing automation equipment, but also inseparable from high-quality engineers. "Chip manufacturing requires a lot of people, especially the development, polishing, and so on. It requires a lot of skill." Lu bin said.
Thus, if the key positions are missing, it is likely to affect the capacity of the fabs. And racing against time to rush back to the factory chip people, is undoubtedly the guardian of chip capacity warriors.
"The production lines of SMIC, Huahong and other fabs have not been suspended due to the epidemic. They are mainly under closed management, and the operations inside the factories are still normal," Qiao An, an analyst at JIbon Consulting, told reporters. However, logistics and transportation disruptions have caused shipment delays and the impact is expected to continue until the end of April."
Many factories in Kunshan stopped production
"Production is now normal and more than 500 employees have arrived, mainly front-line staff." Shanghai silicon industry related person in charge of the "daily Economic News" reporters said.
According to Shanghai, the lockdown began at 5 am on March 28 in Pudong, and all enterprises in the lockdown area will be closed for production or work at home (except those to ensure the livelihood of citizens and the basic operation of the city). According to People's Daily, Xisheng Semiconductor, a wholly-owned subsidiary of Shanghai Silicon Industry, organized and coordinated nearly 400 people to enter the company at 4 am on March 28 to keep the factory staffed.
Silicon wafers are an important raw material for chip production. Without semiconductor wafers, wafer factories would be starved of rice. Silicon chip manufacturers in Shanghai silicon industry production line, can effectively ensure the supply of key raw materials chips.
Shanghai chip industry chain companies are normal production, kunshan, the nearest to Shanghai, but some chip companies have stopped production. Global Wafer, one of the world's top five semiconductor wafer makers, is suspending production at its factory in Kunshan.
For the kunshan chip factory to suspend production, an industry insider said, "because kunshan has several factories found positive these days." Lu bin also revealed: "The factory in Kunshan (stopped production) because last time we took goods back (from Shanghai), a few people took a ride, but it turned out to be positive."
On April 5, Kunshan announced that the city had further upgraded its epidemic prevention and control measures for three consecutive days since April 6. With the exception of public service enterprises such as water, electricity, fuel oil, gas, communications, sanitation, food, oil, meat and vegetable supply that ensure the life and operation of the city, other enterprises are allowed to take turns to reduce production or work at home.
Compared with Shanghai's "closed production", Kunshan's "take turns to cut production" epidemic prevention measures are more stringent. After three days of total silence in Kunshan, there were four days of total silence until April 12.
On the morning of April 11, a reporter from National Business Daily called Kunshan Zhongchen Silicon Co., LTD. (hereinafter referred to as "Zhongchen Silicon"), a wholly-owned subsidiary of Global Wafer. A source said, The company has about 300 employees and 96 are currently stationed at the plant. The resident staff had nothing to do but make nucleic acid every day. The company is ready to resume production on The 13th, but depends on the government's follow-up notice. Even if the production can resume on 13th, there are still many raw materials cannot be transported in. It is not enough to resume production immediately. Some departments have not delivered raw materials, so they can only start up gradually."
As for the source of raw materials, the above staff said: "From Shanghai, Zhejiang around, some materials storage time is short, even can not be stored in the plant." In addition to the transportation of raw materials, the issue of staff access is also an important factor restricting the resumption of production. The official said, We can start the plant only when all the other workers come, and it is not possible to rely on the 96 people currently stationed at the plant. Resuming production requires unsealing and employees to be able to come and go freely."
On the evening of April 12, kunshan announced that some areas will remain silent for another seven days until 24:00 on April 19. On April 13, a reporter from National Business Daily called Zhongchen Silicon again and asked whether the company had resumed production, a staff member said, "No, the company is located in the silent area and will resume production after the 19th."
Home office design company
Employees of chip design firms can work from home, whereas wafer manufacturing and wafer manufacturing require a resident factory. "Design companies are more home, less impact. A lot of design can be cloud-based, breaking down projects without a big impact." Zhang Guobin said.
To help employees stay at home, the Shanghai chip company is doing things like delivering food and even counseling. In the reporter's wechat moments, an employee of a chip design company said: "It's a good thing the company delivers food, or I'll be scolded by my daughter-in-law." My gratitude was overwhelming.
China chip IP leading core original shares, but also sent two consecutive dishes. On March 29, the second day after Pudong was quarantined due to the epidemic, Xinyuan's "gift packages" were ready to go. On March 30, its employees in Pudong received gifts of love, fully 10 kilograms of vegetables. On April 7, Xin Yuan Stock again launched the second batch of "feeding plan", vegetables and fruits will arrive on the same day.
Source: Xinyuanren official account
During the epidemic, such a group of people became popular, and people in Shanghai affectionately called them "my chief". In Shanghai, a chip company is led directly by the administrative department. Lin Xiao (pseudonym), vice president of the chip design company, told National Business Daily: "In the past, our company had a support group to send some support, such as vegetables and food, to employees who stayed at home. Later, when they all stayed at home, the company regularly bought some food for the employees and sent it to the employees in urgent need through external logistics companies."
Compared with Shanghai, Wuxi, another major chip city in the Yangtze River Delta, has been much less affected by the epidemic. "Wuxi's strategic position is very important in the whole Yangtze River Delta region," Xiao Zhongwen, marketing director of Gootai Microelectronics, told reporters. It includes branches of various chip companies, a large number of start-up chip companies, and some IP providers. Since the outbreak, the prevention measures in wuxi have been very good."
As a chip design based enterprise, gootai Micro employees are not affected by the normal work. Assuming wuxi also goes into a quiet period, will working from home have a significant impact on the development process?
"Employees can work wherever there is an Internet connection," xiao said. Our r&d staff and others are not rookies, they have guidelines and a clear roadmap in mind. Not only the circuit diagram of the product, but also the system framework and principle model of the chip product itself, the whole staff of our company are very devoted and focused. We have accumulated a lot of innovative ideas and implementation experience in product architecture and definition. The epidemic has little impact on a front-end design company like us. But in the relatively short term, the impact on the factory side needs to be reassessed and there needs to be more cohesion and care on the psychological level."
These problems need to be solved
In order to supply chips, the chip people in Shanghai actively "fight". Lin Xiao, who lives in Shanghai, also shared his problem. "Customers are already cancelling orders. At present, the main difficulties are financial payment, invoicing and logistics. Shanghai logistics almost all stopped, the warehouse is located in the containment area, can not enter the people. It's two weeks old. It's not going anywhere. Before, financial payment was managed separately by USB Key and password, but now it is not very convenient or safe to apply for online payment. The hardest part is invoicing, which is almost impossible to do at home due to the unified Shanghai system."
Working from home can also affect the schedule of some design firms. "Different products require different resources to design, and each company should face different dilemmas," Lin said. The chip process includes layout design, simulation of design parameters, process parameters, wafer production, package test, etc. Design companies only do layout design, parameter simulation. This can be done at home if you have a server or a high speed computer at home. But most people don't have servers at home, so it's harder."
Staff in locked-in areas, logistics problems, even in the port far away from Downtown Shanghai. "I hear from Lingang that it's not much better, that raw material transportation is a problem," Mr Lu said. Now the most core is two things, one is a lot of (chip enterprises) employees in the containment area, temporarily can not come out, resulting in a tight capacity; Second, raw materials can not be transported in, the product is not good luck out. The other problems, I think, can be overcome."
Mr Lin's appeal is: "I hope relevant authorities can find a way to open up warehouses and logistics as soon as possible, and issue special permits to companies so that finance staff can occasionally come to the office and goods can be shipped to Shanghai. Otherwise, after a long time, a design company like us may not be able to carry it."
In fact, the authorities are already taking action. Shanghai silicon industry related person told reporters: "there are difficulties, are solving, or received a lot of support." On the difficulty of transporting raw materials to the port, he said, Fortunately, our importance is relatively high.
On logistics, Xinhua News Agency reported on April 12 that under the Joint Prevention and control mechanism of The State Council on novel Coronavirus infection, the Circular on Ensuring smooth transportation and Logistics services was issued. All efforts should be made to smooth transportation channels, optimize epidemic prevention and control measures, organize the transfer of emergency supplies, guarantee the passage of key supplies and postal and express delivery services, and strengthen service guarantee for employees.
In addition, relevant departments of The State Council should step up supervision and inspection, intensify prevention and control measures, simply implement the "one-size-fits-all" persuade people to return, set up anti-epidemic inspection points in violation of regulations, and arbitrarily block transport channels, urging them to speed up rectification. In cases where the smooth flow of freight transport and logistics is seriously affected or supplies are in short supply or interrupted, relevant localities, units and personnel shall be investigated for their responsibilities in accordance with laws and regulations.
It is worth mentioning that the epidemic is also an opportunity for chip companies. Xiao zhongwen analyzed: "For technology companies, it is more an opportunity. Since the outbreak of COVID-19 in 2020, there has been significant growth and innovation in consumer electronics, medical devices, intelligent vehicles, industrial technology and other products, such as AI identification, teleconferencing systems, new energy vehicles, industrial automation, electric energy storage systems, and intelligent security. "The growth of diverse end products is also driving considerable diversity in chip design firms, expansion and iteration of fab capacity, and innovation and application of process technologies."
