SOURCE / COMPANIES
Foxconn industrial park forced to diversify as chip ban hits Huawei shipments
Published: May 29, 2021 12:00 AM
Foxconn’s Intelligent terminal manufacturing industrial park in the Gui'an New District, Southwest China’s Guizhou Province on May 28, 2021 Photo: Chi Jingyi/GT

Foxconn’s Intelligent terminal manufacturing industrial park in the Gui'an New District, Southwest China’s Guizhou Province on May 28, 2021 Photo: Chi Jingyi/GT


Foxconn's Intelligent terminal manufacturing industrial park in Southwest China's Guizhou Province, which was designed to be a foundry for Huawei smartphones, is seeking to manufacture other intelligent products as Huawei's shipments decrease amid a US chip crackdown, the Global Times learned on Friday.

"The US crackdown on Huawei has had a significant impact on the company's smartphone shipments. Since the future is unclear, our industrial park is already bringing in other customers for the sake of industrial value output," a manager at the Foxconn industrial park told the Global Times on Friday.

The industrial park was put into operation in September 2015, and shipped a total of 100 million Huawei phones by April 2020. It is located in the Gui'an New District. 

The park enjoys preferential fees for electricity and land use, and it has committed to provide jobs and increase the value of industrial output in the area, according to the manager.

The total industrial output value of Foxconn Gui'an park reached 15 billion yuan ($2.36 billion) in 2017, 18.435 billion yuan in 2018, and 21.3 billion yuan in 2019. Currently, the park has 18,000 employees in the first and second phases of the plant. After the third phase of the plant starts, a total of 30,000 new jobs will have been created.

Huawei’s Cloud Data Center, under construction in Gui'an New District, Southwest China’s Guizhou Province on May 28, 2021 Photo: Chi Jingyi/GT

Huawei’s Cloud Data Center, under construction in Gui'an New District, Southwest China’s Guizhou Province on May 28, 2021 Photo: Chi Jingyi/GT


"If it were not for the COVID-19 epidemic and the lack of chips, 200 million units would have been shipped by the end of 2020. We planned to produce 60 million Huawei phones this year, but less than half of the target has been completed," said the manager. 

The park shipped 23 million Huawei phones in 2018, and 45.78 million phones in 2019. Shipments in 2020 plunged more than 40 percent, the manager added.

Major chip producers like Taiwan Semiconductor Manufacturing Co (TSMC) and Qualcomm, were banned by the US from manufacturing chips for Huawei.

An insider at Huawei, who refused to be named, told the Global Times on Friday that Huawei is now forced to use 14-nanometer or 28-nanometer chips for equipment such as data storage machines, while its high-end smartphones that use 7-nanometer chips are suffering from the chip shortage.

"Some domestic manufacturers can produce 14 or 28-nanometer chips for Huawei," the insider said. 

Huawei's Kirin chip designed by its chip arm Hisilicon has the strongest compatibility with Huawei mobile phones and the lowest defect rate at less than 2 percent, the Foxconn manager noted.

The Gui'an New District is also home to the big data center of China Mobile and Huawei.

The Gui'an Huawei Cloud Data Center will be the biggest data center in the world, capable of accommodating 1 million servers, a manager surnamed Huang at Huawei's data department told the Global Times on Friday.

"With the technology of 'digital twins,' and by using artificial intelligence (AI) patrol robots, the operation and maintenance cost can be reduced by 35 percent. At the same time, the annual average temperature of Gui'an New District is 15 C, and the operation and maintenance temperature of the machine room is about 23 C. Building a data center in Gui'an can cut the cooling costs significantly," Huang said.

Construction of the center will be completed by the end of next year.


blog comments powered by Disqus