China foundry XMC has broken ground for its new 3D NAND flash fab, the country’s first China-owned 3D NAND flash facility.  Plans for this fab were publicly disclosed over a year ago.  Simon Yang, XMC’s CEO, gave a presentation at SEMI’s Industry Strategy Symposium (ISS) on January 11, 2015 in which he detailed the need for China to produce a larger proportion of its overall chips, explaining how his company would help make that happen.

Yang used the map in this post’s graphic to show that XMC has enough land on its campus for six 300mm wafer fabs.  Two shells (yellow), each capable of processing 30,000 wafers per month, had been constructed by that time: Fab A (left) was already fully utilized, and Fab B (right) was ready for tooling.  The gray boxes show that the site has enough space to build 2 additional 2-line megafabs, each with a capacity of up to 100k wafers per month.  Accoding to DRAMeXchange XMC currently produces 20,000 wafers of NOR flash per month.  A March 30 China Daily article reports that monthly wafer production will reach 300,000 in 2020 and 1 million in 2030.

XMC’s formal name is Wuhan Xinxin Semiconductor Manufacturing, and it is located in the East Lake High-tech Zone in Wuhan city, the capital of Hubei province.  China Daily reports that Hubei has set up a special investment fund of 50 billion yuan ($7.7B) to support the IC industry, apparently a part of China’s National IC Investment Fund of 138 billion yuan ($24B).

China’s chip investments are most likely being guided by “Made in China 2025” report, released in May 2015, which, according to The Economistrepresents: “a costly scheme that will use mandates, subsidies and other methods to persuade manufacturers to upgrade their factories. The plan is for China to become a ‘world manufacturing power’ by 2025.”  The report was compiled by China’s Ministry of Industry and Information Technology (MIIT) using the collective input of 150 experts from the China Academy of Engineering.

There’s good reason for China to try and participate in this market.  As the world’s leading contract manufacturer, China imports an enormous volume of chips.  The World Semiconductor Trade Statistics (WSTS) puts China’s chip consumption at $98B for 2015, although the China Daily article more than doubled that figure to $218B, which is probably too high, since it would account for 65% of the entire world’s semiconductor shipments.  By producing its own chips, China will reduce its reliance on foreign sources of supply while capturing the profits that would otherwise leave the country.

The Memory Guy has a guarded outlook for XMC’s chance of initial success.  Its 3D NAND chip, which DRAMeXchange says was verified last year, was designed in conjunction with Spansion, and neither Spansion nor XMC has volume production experience with NAND flash, not to mention 3D NAND.

Aspirations are high, though.  China Daily quotes Zou Xuecheng, a professor of semiconductor engineering at Wuhan’s Huazhong University of Science and Technology, as saying: “China’s capacity in memory products will keep up with or surpass that of countries like the Republic of Korea in five to 15 years.”