I’m on the UK’s latest laptop chip plant in Durham. Formerly a ceramic pipe manufacturing facility, from the skin it appears like a giant warehouse.
But contained in the huge house is being reworked into a complicated hub for the manufacturing of laptop chips.
Pragmatic Semiconductor has already constructed one manufacturing line, which the trade likes to name fabrication traces, or fab traces.
Sealed off in its personal massive room, the manufacturing line has all of the costly equipment wanted to make the pc chips, and the air inside is fastidiously managed to keep away from any contamination throughout manufacturing.
Pragmatic has the cash to construct one other such manufacturing line, and funding of £182m ($230m) introduced late final 12 months will fund manufacturing traces three and 4.
As properly as from non-public buyers, Pragmatic secured funding from the government-backed UK Infrastructure Bank and British Patient Capital, a subsidiary of British Business Bank.
But the Cambridge-based firm will want way more cash to finish its plan to construct eight manufacturing traces within the outdated pipe manufacturing facility.
From telephones and computer systems, to vehicles and washing machines, nearly each product with an on-off change depends on the manufacturing of laptop chips, often known as semiconductors.
It is an trade that has seen a variety of turbulence over the previous few years. There’s been disruption to produce chains throughout the pandemic, and geopolitical tensions in Asia, the place 90% of the world’s most superior chips originate.
David Moore, chief govt of Pragmatic Semiconductor, which is the most important semiconductor producer within the UK, says the trade goes to wish a number of forms of semiconductors to unravel “different kinds of problems” within the chip sector.
Most semiconductors are made utilizing silicon, however his firm is taking a distinct method.
They are making versatile chips – they really bend – at their plant in Durham, which can be utilized in wearable expertise, clothes authentication, and even in parcel labels to trace and hint objects.
Rather than sitting on silicon wafer, Pragmatic’s chips are constructed on a versatile skinny movie.
This method leads to chips which can be cheaper and sooner to fabricate than the usual silicon chip.
“If you take a standard silicon manufacturing facility, it’s going to take multiple years and billions of dollars to make,” Mr Moore stated.
“Our fabrication plant can be 10 to 100 times cheaper depending on what you compare it with.
“In silicon, it would take three to 6 months to go from the beginning of the method all the way in which to a completed wafer product. For us, we are able to do this in lower than 48 hours.”
But it is no panacea. The flexible chip may be cheaper and quicker to make, but the advanced chips in phones, computers and other leading tech will still need the most advanced silicon-based computer chips.
A serious shortage of those chips in 2021, underlined how dependent global industry is on a few key suppliers.
In particular, Taiwan Semiconductor Manufacturing Company (TSMC) makes 90% of the world’s most advanced semiconductors.
In an effort to cut that dependency governments are spending huge sums to create stronger domestic chip industries.
In August 2022, the US government signed into law the US Chips Act, which pledged $52bn (£41bn) to boost domestic production of computer chips.
The European Union has its personal venture value €43bn (£37bn).
On a smaller scale the UK has promised £1bn of investment in the sector.
Analysts says that the big chip manufacturers are responding to such government incentives.
Germany has seen a huge wave of investment. A Taiwanese semiconductor manufacturer has decided, together with three European headquartered companies, to invest €10bn in Dresden.
“We see that 80% of of worldwide manufacturing is presently in Asia, the reliance on Asian international locations means we actually must strengthen our resilience right here within the EU,” notes Hendrik Abma, director general of the European Semiconductor Industry Association.
“I feel the realisation in regards to the significance of semiconductors for trade right here in Europe, for our technical growth, has been underestimated up to now.”
As well as Germany, Mr Abma notes that Belgium, Lithuania and the Czech Republic, have seen significant investments.
Following the US Chips Act, almost 500 companies applied to the US government for funding for projects, according to Hannah Dohmen, research analyst at Georgetown’s Centre for Security and Emerging Technology in Washington.
Plants are planned in New York, Arizona, Texas, Ohio and Idaho, she says.
And outside the US and Europe, other projects are planned.
“We’re additionally seeing India try and enter the chip manufacturing house. A rustic that has a powerful historical past in chip design however shall be ranging from scratch in manufacturing,” Ms Dohmen added.
“India wish to be a giant participant within the house, and with intensifying competitors with China. This has prompted the US and different allied international locations to strengthen tech cooperation with India.“
It all sounds very positive but building computer chip plants is not easy.
Plans by TSMC to build advanced chips in Arizona have run into trouble, with the company blaming a scarcity of expert staff.
Others worry that the rush to build plants in Europe and the US, will just mirror what already exists in Asia.
“There’s a danger of duplication and wastefulness throughout the trade,” Ms Dohmen stated.
Meanwhile, Mr Moore predicts more diversification in how semiconductors are made and what they’re used for.
“You go from tens of billions of linked issues to a whole lot of billions and trillions of linked issues, finally you find yourself with that very difficult component of not having the ability to provide to it, and so various provides in excessive quantity are what are going to be required.
“And being able to provide those cost effectively and at scale – that’s the big challenge.”
