Paul van Gerven
Editorial

Don’t let China corner the mature-node markets

Reading time: 3 minutes

Cut off from advanced manufacturing equipment by export restrictions, China could very well double down on legacy nodes. This should set off alarm bells in the West.

In many ways, the decision of the British government to retroactively block the acquisition of the Newport Wafer Fab by Nexperia is ridiculous. The decades-old facility was struggling, even facing bankruptcy before Nexperia came along. Its employees are perfectly happy with the new owner, describing the company prior to the takeover as a “mismanaged, undercapitalized startup, struggling to compete even in a buoyant market.” And the government’s decision-making process has been questionable, to say the least. Two prior probes didn’t turn up any national security concerns. If there were any nonetheless, the government hasn’t made any attempts to address them by engaging in dialogue with Nexperia.

It’s a sign of the times that the UK’s decision-makers pushed the blockade through anyway. Western anxiety about Chinese involvement in tech firms is at an all-time high (Nexperia and its owner Wingtech insist they operate independently from Beijing), as is the fear of being overly dependent on others for technology. Not so long ago, the acquisition of an ailing fab used to manufacture mature semiconductor technology would have barely registered on politicians’ radars.

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