Bosch is teaming up with US chip startup Tenstorrent to establish a standard platform for automotive chip development. The collaboration focuses on standardising the use of chiplets, which are essential components of modern chips, to create versatile systems tailored for various automotive needs. David Bennett, Tenstorrent’s chief customer officer, emphasised that this initiative aims to redefine how automakers approach silicon procurement and production.
By integrating diverse types and quantities of chiplets into complete processors, both companies seek to enhance cost efficiency and accelerate the introduction of new silicon products in the automotive sector. The rapid rise of electric vehicles has turned cars into complex computer systems powered by batteries, prompting a need for innovative chip solutions.
As the industry adapts to the complexities of electrification and automated driving, vehicle manufacturers are exploring new pathways to either build or acquire the necessary chips. Standardising the technical requirements of chiplet building blocks could lead to reduced costs, according to Bennett, enabling a more efficient and customisable approach to automotive design.
Although specific products or sales to automakers have not yet been established, the collaboration aims to produce a standard chiplet design. Such designs would allow automakers to customise their vehicles while saving costs compared to off-the-shelf components. Tenstorrent’s CEO, Jim Keller, previously led chip design efforts at Tesla, further strengthening the expertise behind this innovative partnership.
China is calling on the United States to lift sanctions on Chinese companies in semiconductors and intelligent connected vehicles, aiming to create a more stable business environment. In a recent conversation with US Secretary of Commerce Gina Raimondo, China’s Minister of Commerce, Wang Wentao, expressed serious concerns over US trade restrictions and emphasised the need to clarify national security policies.
He argued that clear guidelines would protect the stability of global supply chains, which are essential for electronics, automotive, and pharmaceutical industries. Analysts and business leaders emphasise that strong U.S.-China trade relations reduce production delays and disruptions. Despite upcoming election challenges, experts believe cooperation is likely. US companies may advocate for balanced trade policies due to their reliance on China, underscoring the need for a stable and cooperative trade relationship.
Moreover, China’s growing appeal as an investment destination is underscored by its third-place ranking on the 2024 Kearney FDI Confidence Index. Consequently, businesses increasingly view China as a vital market and innovation hub, with companies like Dun & Bradstreet and Skechers expanding their operations in response to its strategic supply role and vast consumer base. In addition, business leaders advocate for deeper US-China trade relations, recognising collaboration’s competitive advantages.
Furthermore, recent trade data reveals that the US remains China’s third-largest trading partner, with a trade volume of 3.15 trillion yuan ($446.21 billion) in the first eight months of 2024. This robust trade relationship highlights the critical need for ongoing cooperation between the two economies, especially in an increasingly competitive global landscape.
Dutch economy minister Dirk Beljaarts revealed a plan to form a ‘coalition of the willing’ within the EU to strengthen the bloc’s computer chip industry and compete globally with the US and China. At a G7 industry ministers’ meeting in Rome, he stressed the importance of EU nations working together to set up production, assembly, and packaging facilities. While the Netherlands is home to leading chip tool maker ASML, Beljaarts emphasised that other EU countries must also build their semiconductor industries.
Beljaarts expressed the Netherlands’ readiness to lead this initiative, collaborating with Italian Industry Minister Adolfo Urso to bring the plans to life. Although the Netherlands is not a G7 member, its influence in the tech sector, as the world’s 18th largest economy, secured its invitation to the meeting. The EU’s chip strategy has recently faced challenges, particularly after the departure of Thierry Breton, the former EU Commission industry chief and architect of the EU Chips Act. The act, valued at €43 billion, aims to boost Europe’s share of the global chip market to 20% by 2030.
In a separate meeting, Beljaarts spoke with US Secretary of Commerce Gina Raimondo, discussing potential areas of cooperation. This discussion took place amid anticipated US export restrictions on advanced semiconductor equipment to China, which could impact ASML. However, Beljaarts clarified that the talks focused on collaboration rather than export limitations.
Industry ministers from the G7 advanced democracies have agreed that non-market practices in the semiconductor industry pose an urgent challenge that requires collective action. This consensus was announced by the Italian presidency and is a response to growing concerns about China’s influence in the sector. During the G7 summit in June, leaders had previously pledged to address what they called unfair business practices by China, particularly as the country aggressively advances its semiconductor manufacturing capabilities.
The majority of global semiconductor production takes place in South Korea and Taiwan, with Taiwan’s closeness to mainland China heightening concerns about potential military conflicts that could disrupt global supply chains. Due to Taiwan’s leadership in advanced chip manufacturing, major economies such as the US and European nations have enacted legislation to enhance domestic semiconductor production. Initiatives like the US CHIPS Act and corresponding European measures have allocated substantial funding to incentivise companies to set up chip production facilities within their countries.
Alongside semiconductor issues, the newly established G7 task force will also focus on undersea cable connectivity, which has grown increasingly critical. Recent outages in major undersea cables have underscored the necessity for a stable and secure global internet infrastructure. This expansion of the G7’s agenda aims to address broader technological stability, moving beyond semiconductor concerns to encompass essential aspects of digital connectivity.
On September 21, Prime Minister Pham Minh Chinh signed Decision No. 1018/QD-TTg, establishing Vietnam‘s strategy and vision for developing its semiconductor industry. This strategic plan outlines both short-term objectives until 2030 and long-term projections extending to 2050, emphasising five key tasks – developing specialised chips, promoting the electronics industry, enhancing human resources and attracting talent, drawing investment into the semiconductor sector, and implementing additional relevant measures.
The strategy includes a three-phase roadmap. In Phase 1 (2024-2030), Vietnam aims to leverage its geographical advantages and existing semiconductor talent to attract foreign direct investment (FDI). The goals are to establish at least 100 design companies, one small semiconductor chip manufacturing plant, and 10 packaging and testing facilities, with the semiconductor industry projected to generate over USD 25 billion in revenue annually. The workforce is expected to exceed 50,000 engineers and university graduates.
During Phase 2 (2030-2040), Vietnam intends to strengthen its position as a global center for semiconductors, targeting 200 design companies, two chip manufacturing plants, and 15 packaging and testing facilities. The expected annual revenue for the semiconductor industry is projected to surpass USD 50 billion, with a workforce growing to over 100,000 engineers and graduates.
In Phase 3 (2040-2050), Vietnam aspires to become a leading player in the global semiconductor arena, aiming for at least 300 design companies, three semiconductor chip manufacturing plants, and 20 packaging and testing facilities. The semiconductor industry’s revenue is anticipated to exceed USD 100 billion annually, while the electronics sector is expected to surpass USD 1.045 trillion. Despite the government’s ambitious strategy, challenges remain, including power shortages, competitive salaries for talent, and a weak technological foundation.
MediaTek is reportedly collaborating with NVIDIA to develop a new AI processor, which is expected to be manufactured using 3nm technology and is slated for tape-out later this month. This move comes alongside MediaTek’s recent launch of its Dimensity 9400 smartphone chipset, indicating the company’s ambition to diversify its product lineup. The new AI processor is projected to enter mass production by late 2025 and aims to fill a gap in the market for Windows-on-Arm devices, especially given the comparatively weaker graphics performance of Qualcomm’s Snapdragon X Elite.
The new chip is expected to work alongside NVIDIA’s GPU, aiming at major laptop brands like Dell, HP, Lenovo, and Asus as potential clients. Priced at approximately $300, this processor signifies MediaTek’s move into the AI PC sector, marking a significant shift from its usual collaborations with AMD. However, MediaTek has previously partnered with NVIDIA, notably in their recent unveiling of automotive SoCs that incorporate NVIDIA technology, highlighting their mutual interest in enhancing AI capabilities.
As the AI landscape evolves, MediaTek’s partnership with NVIDIA could bolster its position in a competitive market, especially given NVIDIA’s dominance in AI processors. This collaboration underscores MediaTek’s strategic shift and opens avenues for innovative products in the AI-driven technology sector.
OpenAI, known for its AI models, appears to be exploring the semiconductor manufacturing sector, raising questions about the feasibility of building wafer fabrication plants. Reports recently surfaced about CEO Sam Altman’s discussions with executives from major chip manufacturers, including TSMC and Samsung, during his trip to Asia last year. Altman proposed an ambitious $7 trillion plan to construct 36 new wafer fabs and data centres, aiming to produce AI chips funded by the United Arab Emirates. He believes these facilities would support the burgeoning demand for AI capabilities.
The investment Altman suggested is staggering, amounting to a quarter of the annual output of the US economy. However, the timeline for establishing these fabs is lengthy, as it would take several years to meet OpenAI’s growing computing power requirements. TSMC, while approached for the project, found the proposal too aggressive and risky, noting that even a few additional wafer fabs would entail significant capital and risk.
Building a wafer fab is an enormous undertaking, often costing hundreds of billions of dollars due to various factors. The expenses stem from land acquisition, facility construction, equipment procurement, and ongoing operational costs. Advanced lithography machines and other essential equipment represent substantial financial commitments, while research, maintenance, and talent training add to the complexity. Current estimates place the cost of modern fabs in the billions; for instance, Intel’s factories in Arizona are expected to cost around $15 billion each, and Samsung’s Texas fab is projected at $25 billion.
Moreover, the cost of constructing a wafer fab varies by region. In Asia, established supply chains, available talent, and supportive policies contribute to lower costs, whereas building in Europe, the US, and the Middle East can be more expensive due to the necessity of importing technology and developing a comprehensive supply chain. Overall, OpenAI’s ambitions in the semiconductor space highlight the significant challenges and investments required to succeed in this critical industry.
Foxconn is constructing the world’s largest facility in Mexico for bundling Nvidia’s GB200 superchips, a crucial component of Nvidia’s upcoming Blackwell computing platform. The Taiwanese electronics giant, known for assembling Apple’s iPhones, has been capitalising on the surge in demand for AI technology by manufacturing servers designed for AI processing.
Nvidia has already started shipping samples of its Blackwell chips and expects substantial revenue from these in the coming months. Foxconn executives highlighted the enormous demand for Nvidia‘s Blackwell platform, with many industry players seeking to adopt this next-generation AI computing technology.
The manufacturing plant in Mexico will have substantial capacity, building on Foxconn’s existing investments in the country. The company’s production capabilities are equipped with advanced liquid cooling technologies necessary for supporting AI servers, ensuring they meet the growing needs of the AI sector.
In addition to its focus on AI, Foxconn is diversifying its operations by expanding into the electric vehicle market. The company plans to leverage its technological expertise to become a leading EV contract manufacturer, producing vehicles under its Foxtron brand while helping automakers with manufacturing.
South Korean tech giant, Samsung, has issued an apology to its customers and investors after missing market expectations for its third-quarter earnings. The electronics giant reported a consolidated operating profit of KRW9.1 trillion ($6.64bn), falling short of the KRW10.33 trillion ($7.65bn) predicted by analysts. Despite this, the company’s sales saw a 6% rise compared to the previous quarter, totalling KRW79 trillion ($58bn).
Vice-chairman Jun Young-hyun expressed concerns over the company’s performance, emphasising the need to regain its technological competitiveness. The statement acknowledged Samsung’s struggle to keep up with market demands, particularly in the rapidly expanding AI chip sector, where rivals like Nvidia have surged ahead. Samsung’s stock fell a further 1.3%, compounding its 20% decline earlier this year.
Samsung has held the title of the world’s largest memory chipmaker for over 30 years but faces increasing competition in both traditional and advanced chip sectors. The delay in the launch of its high-bandwidth memory (HBM3E) chips has been one of the challenges contributing to its weaker performance, with rival SK hynix making significant gains.
Industry analysts highlight that Samsung’s slower response to the AI chip boom has made it more dependent on lower-margin legacy chips. The company’s memory and contract chip manufacturing divisions have both struggled against competition from Chinese manufacturers and Taiwan Semiconductor Manufacturing Company (TSMC). More detailed earnings figures are expected later this month.
Samsung Electronics, the world’s largest memory chipmaker, has dismissed speculation that it will spin off its foundry business, which produces semiconductors for other companies. Chairperson Jay Y. Lee emphasised the company’s commitment to growing the foundry business within Samsung’s broader semiconductor operations, citing the advantages of leveraging synergies between its memory and logic chip divisions.
The pressure to keep pace with industry leader TSMC has fueled talk of a possible spin-off, as analysts suggest it could allow Samsung to operate more independently and attract additional clients. However, Samsung believes keeping the foundry business aligned with its overall operations is strategically beneficial, enabling it to streamline processes and stay competitive in a technology-driven industry.
The company is focused on expanding production, particularly in advanced technologies like 3-nanometer chips, and aims to overtake TSMC as the largest contract chipmaker by 2030. Despite these ambitions, Samsung faces challenges, including delays in its new Texas chip factory due to shifting US policies and financial losses in its foundry unit.
Nonetheless, the company remains committed to its current structure, viewing it as key to pushing the boundaries of semiconductor innovation and maintaining its market position amid fierce competition.
