TSMC to invest 31 trillion… Do you miss it during Samsung’s’foundry super competition’?

There was a dark cloud in the domestic semiconductor market, which had high expectations for a’supercycle’ (long-term boom) this year. This is because Samsung Electronics Vice Chairman Lee Jae-yong, who was being tried in the case of Gukjeong Nongdan, was arrested on the 18th, and there is concern that Samsung’s semiconductor investment and execution may be disrupted.

First of all, Samsung Electronics is continuing its daily work. On the 19th, the 5th entrance ceremony for the’Samsung Youth SW Academy’ was held as scheduled at the Seoul Multi Campus in Gangnam-gu, Seoul. It is an educational program that expands the information technology (IT) ecosystem and supports youth employment. Samsung’s position is that it will maintain the Samsung Compliance Monitoring Committee, which was established at the order of the judiciary, but was judged to have “did not meet the effectiveness criteria.” It is a’quiet emergency management’. However, the atmosphere of discouragement is strong within the company. A business official who requested anonymity said, “Recently, LG and SK have been active in attracting large-scale mergers and acquisitions (M&As) or investments, but Samsung will only be urgently focused on’maintaining the status quo’ due to the absence of an owner.”

Experts predict that Lee’s arrest will have a negative impact on the domestic economy and industry. At the moment, major decisions such as large-scale investments and M&As are inevitably delayed, and the recruitment of global talent is expected to cease. Korea University Business School Professor Park Kyung-seo said, “There will be no problems with management right away, but it is difficult for professional managers to be active in securing future foods such as R&D, where results will be achieved only in 5-10 years.”

In particular, there is great concern about the semiconductor industry, which accounts for about 20% of domestic exports. Samsung is unrivaled in the memory semiconductor field, but in non-memory fields such as system semiconductors, it is behind TSMC in Taiwan, Qualcomm in the US, and Sony in Japan. In this regard, Samsung Electronics has announced’Semiconductor Vision 2030′, which will invest 133 trillion won by 2030 to take the world’s No. 1 system semiconductor. It was planned to invest 12 trillion won in the system semiconductor field this year alone. However, experts are concerned that the absence of Vice Chairman Lee will push Samsung Electronics from competing for speed with competitors. This is especially the case in the foundry (semiconductor consignment production) field where Samsung is pursuing TSMC. Currently, TSMC and Samsung Electronics are the only companies in the world that can perform ultra-fine processes below 5 nm (nanometer, 1 billionth of a meter). In fact, there are only two companies that can mass-produce the application processor (AP) required for 5th generation (5G) smartphones.

However, TSMC recently announced that it will make facility investments of 25 to 28 billion dollars (about 27 to 31 trillion won) this year. It is twice the level of last year and the largest ever. Most of the facility investment will be focused on ultra-fine processes below 5nm. At the same time, Samsung Electronics faced the bad news of being arrested. Choi Jae-sung, a professor at the Department of Semiconductor Equipment Engineering at Far East University, said, “Since the semiconductor production line costs tens of trillions of astronomical amounts, there is a limit to the decision by professional managers.” I will.”

There is also a prospect that Vice-Chairman Lee will not do’outdoor management’, but in reality it is not easy. The issue of inheritance must also be resolved and a trial for succession of management rights must be prepared. A business official said, “It is impractical for the management to report and approve the decisions that need to be made after a long period of review and discussion, even though the visit time is 10 minutes a day.”

Reporter Choi Hyun-joo [email protected]