Continuing leadership of western China's growth

Technological advances and automobile manufacturing bring higher value, profits to western China megacity through partnerships and investment, Tang Zhihao reports.

New business projects in the electronic information and auto industries are expected to support Chengdu's industrial upgrading and transformation, helping to build the city into a western economic center.

Global Foundries (GF), the United States' full-service semiconductor wafer producer, is scheduled to complete a new 760,000-square-meter production base in the western part of Chengdu Hi-Tech Industrial Development Zone in March next year. It is expected to be one of GF's largest and most advanced wafer production bases in the world upon completion. Construction of the project started in February.

GF said that the plant will have both complementary metal oxide semiconductor and fully-depleted silicon-on-insulator technology-based 12-inch wafer production lines.

The company's project fills the gaps in 12-inch wafer production in Southwest China. It will enlarge the scale of Chengdu's electronic information and integrated circuit industries, which will help the city to build a globally-renowned integrated circuit industry base, according to an official at the zone.

Upon completion, the total production capacity of the new plant will be 85,000 units per month.

There will also be supporting facilities such as a central power plant and office buildings in the production base.

"Such a large-scale wafer production base is rarely seen in the world," said Yuan Ming, a project manager from Chengdu Construction.

Sanjay Jha, CEO of GF, said Chengdu is the ideal place for the project as the city has the necessary infrastructure, skilled manpower and a high-tech company cluster.

"There is no doubt that Chengdu is an excellent partner for the project. This cooperation will improve Chengdu's reputation as a leader in China's semiconductor and IT industry, and will also help the city to draw more investment from high-tech companies."

Chengdu has considered electronic information to be a strategic emerging industry and has long been committed to cultivating related domestic businesses, as well as attracting foreign industry giants.

Chengdu has built complete industrial systems in integrated circuits, smart terminals, internet communications, photoelectronic displays and software and service outsourcing. The city, which attracted Dell, Lenovo, Foxconn, Huawei, Siemens and ZTE, has been playing a more and more significant role in the global market in the electronic information sector, according to local officials.

The city is home to leading global giants including Intel, Texas Instruments, AMD, Taiwan-based MediaTek and Chinese Spreadtrum Communications.

Chengdu said in its latest development plan that the electronic information industry will be the first industrial cluster in the city with annual industrial output value reaching 1 trillion yuan ($145.22 billion) by 2020. That includes 570 billion yuan in the electronic information manufacturing sector, with an average annual growth rate of 20 percent, and 430 billion yuan's average industrial output value in the software and information services sector.

The city set a goal to be an electronic information industrial base with a strong global presence in the 13th Five-Year Plan period (2016-20).

Car industry development

Chengdu has shaped a complete automotive industrial chain to lift the city's competitive capacity.

Volvo launched construction of its scalable product architecture vehicle production platform in Chengdu. The platform, with total investment of 11.2 billion yuan, will be capable of producing 200,000 complete vehicles per year.

Built within Volvo's existing passenger car manufacturing base in Chengdu, the platform will be put into production in late 2017.

Ning Shuyong, Volvo China's vice-president in charge of public relations, said the Chengdu base will produce the next generation of Volvo 60 series vehicles.

Volvo's Chengdu plant is a main production base for Volvo 60 series products. Vehicles produced in Chengdu are supplied to the United States and the Asia-Pacific region. The base has started to export Volvo S60 Inscription to the US and has obtained the highest rating for safety from the US' National Highway Traffic Safety Administration.

Geely, the brand owner of Volvo, signed three strategic investment agreements with Chengdu's government to expand production of new energy vehicles, SPA-based passenger vehicles and BMA platform-based passenger vehicles.

The three projects will allow Geely to produce 600,000 vehicles per year and strongly support Geely's product upgrades.

The automotive industry is a pillar industry in Chengdu. The annual vehicle production volume reached 1 million units in 2016. The expected production volume for this year is 1.1 million vehicles.

Contact the writer at tangzhihao@chinadaily.com.cn

(China Daily 05/14/2017 page18)