The Industrial Giant Reborn.

Chapter 220 Chips and Liquid Crystals

After Henry Morgan left, Chen Zhiwen asked his assistant to notify Lei Shengli to come over.

"Henry Morgan has promised us to ask about the relationship. If his relationship is stronger and we give a little sponsorship to the US congressmen, it should not be a problem." Chen Zhiwen said.

"That would be great. If we can produce chips for home appliances in Hong Kong, the cost will be much lower." Lei Shengli said happily.

They had tried to purchase a new chip production line through normal channels before, and the manufacturer was very interested, because Midea's price is not low, but as a high-tech control product, there are many restrictions on export.

"There is still a chance now, and it will become more and more difficult in a few years." Chen Zhiwen said again.

Today's Hong Kong is not a place strictly controlled by the United States, but the entire semiconductor industry is a moat left by the American industry. Especially after the wave of globalization and the popularity of shipping containers, many industries in the United States have been forced to relocate due to cost.

But fortunately, it is only 1977 now. As long as the export of chip production equipment is not from the countries and regions named, it is not necessary to go to Congress. It only needs to get through some officials.

And in a few years, especially after the rise of Japanese semiconductors and the start of attacking the United States, the control in this area will become very strict.

As for the chip industry in the future, it will definitely be controlled by the United States. Samsung is such a product, and so is TSMC. Chen Zhiwen never thought that he would hope to compete with them. , is also unlikely to be successful.

However, the home appliance industry does not have high requirements for chips. The purpose of building a factory in Hong Kong is mainly to cooperate with the home appliance industry to realize the transformation to chip-based control, because in the previous home appliance field, it was difficult to succeed.

The simplest example is the remote control of color TV and air conditioner, which is not available in this era, because chips and integrated circuits are needed in it, and Midea can try to make it first, or in other words, it will always have an advantage if it is made in the first batch.

But this premise is that R&D and production can cooperate smoothly. If you expect to export chips overseas, it is impossible. You may make mistakes during R&D. Basically, there is no amount. Who will do it for you?
Therefore, regardless of whether the chip industry will die in the future, it is still needed now. Otherwise, the home appliance field will be far behind other peers. This may be an opportunity for the home appliance field to gain more markets.

Besides, there is still a lot of room for Samsung and TSMC to unify the chip market, and the most important thing is that these two giants will basically only produce advanced electronic chips in the future, and other industrial chips or automotive chips will not be produced much. , The auto industry in later generations often lacks cores, which has a lot to do with these two companies.

If you enter the chip field and get squeezed in the mid-term, you can completely transform to produce chips for non-civilian products. Although you may continue to lose money here, as long as you work hard for more than ten years and work hard in the field of industrial and automotive chips, by the 21st century, There will be many opportunities as well.

Even at the beginning of the 21st century, in addition to TSMC and Samsung, there are still a large number of non-high-end chip production plants in the world. However, behind these companies, there is no strong capital and they survive entirely on their own. The industrial market is too small. As a result, many of these companies suffered long-term losses, and most of them went bankrupt. Only a few seized the opportunities in the automotive industry and grew slowly. After 2010, the era of automotive electrification came, and the importance of chips became more and more important. The higher you go, the better it will be in the spring. This is Chen Zhiwen's current goal.

One more point, the home appliance chips you need can also be produced by yourself. If you can really make a difference in the home appliance market, the market here will not be small. Of course, it is far behind the chip giants such as mobile phones and computers.

"That can't be helped, but the home appliance market does not have very high requirements for chip manufacturing, so there should be no problem in a short time." Lei Shengli said.

"Let's go one step at a time, and even if we can't make chips, we still have to participate. When will the placement machine production line at the Midea Industrial Park start production?" Chen Zhiwen asked.

"Japanese engineers are debugging, and it is estimated that trial production will not start until next month." Lei Shengli said.

"Okay, let our people work with translators and learn more from these Japanese engineers. In addition, give these Japanese some red envelopes and let them teach more. It is best to give our people individual lessons after get off work at night. I learned the knowledge." Chen Zhiwen nodded and said.

The semiconductor industry has a very large scale, the most important of which is naturally the chip, and another point is various storage particles, electronic components, etc., and all these electronic components need to be placed on the circuit board, which is often called PCB. plate.

The technological content in the early stage of the chip industry is too high, and it basically requires national-level or top-level industry research and development to make progress. Chen Zhiwen naturally knows that he does not have this ability, so the first step is to make integrated circuit PCB boards first.

This requirement is very simple, as long as you spend money to buy related equipment, and then build a dust-free workshop in Hong Kong, so in the middle of last year, Midea placed an order for a complete set of equipment from a Japanese company, and also invited a Japanese industrial construction company When I came to Hong Kong, I chose a place in the Midea Industrial Park and built a dust-free workshop.

The efficiency of Japanese companies in this era is still acceptable. Up to now, the equipment has entered the clean room for related debugging.

"I've already arranged for people to follow them, but they're still very secretive. These bastards have taken money and are still keeping it secret." Lei Shengli shook his head and said.

"It is estimated that the income of such engineers in Japan is not low. If you want to buy them, you can't do it without hard work." Chen Zhiwen thought for a while and said: "Discuss with them, it is best if you can keep one of them, or go here Similar companies poach a person."

"I also think that I sent people to discuss with these Japanese before, and some of them are willing to pay a high salary, but they all think that we will kick him away after learning his skills, so they don't agree at all." Lei Lei Sheng Li shook his head and said.

"Japanese companies are now severely brainwashed, but the lifelong employment system is still popular. This system is not bad for ordinary workers. It is really difficult to recruit them." Chen Zhiwen nodded and said.

South Korea's Samsung Electronics, in the 80s, wanted to develop semiconductor technology, and it was difficult to recruit people from Japan. It was not until the Japanese semiconductor industry was sanctioned by the United States that a large number of relevant technical personnel lost their jobs, which gave Samsung Electronics a chance.The technical content of production lines such as placement machines is definitely not as good as that of chips, but the current Japanese industry is also at its peak. It is really difficult to recruit Japanese to come to Hong Kong, especially if the level of engineers is basically low. If you have a family, even Samsung has to rent a plane on weekends to send Japanese engineers back to China, and then pick them up on Monday. A lot of costs and expenses were spent in this process, and Samsung finally built the chip and LCD industries.

Lei Shengli went on to say: "I still don't quite believe this group of people in Japan, so I have asked a Japanese headhunting company to look for Chinese in Japan with relevant experience. It is said that I found 3 people there, and they have no life in Japan. With the employment system, it will be easier for us to poach and communicate, but they are from Wanwan.”

"It doesn't matter. As long as we have the ability, we can provide whatever we want, whether it is a house or a car." Chen Zhiwen said with a light smile. Compared with an industry, a house and a car are all pediatrics.

"We are already talking, and my idea is that three people are not enough. We still need more talents of this kind. Only when we have cultivated enough talents in Hong Kong can we be completely at ease." Lei Shengli said again, doing In this kind of high-tech industry, talents are very important. Even if it is cutting-edge equipment, it must be selected by people who know how to choose. Without people, the entire factory may shut down.

"Yes, more is better. Our goal is to supply all kinds of electronic products in Hong Kong first. This is nothing." Chen Zhiwen nodded and said.

Midea's investment in PCB patch production lines is not just for supplying itself. Hong Kong is a big market here.

Although Hong Kong has a small area and few people, the general consumer goods market is not big, but the electronics industry is another matter. Even without Midea, Hong Kong’s electronic products exported 1975 billion Hong Kong dollars in 27, including radios, TVs, electronic watches, calculators, speaker equipment, etc., will double at a rate of three years later.

In fact, these products also need integrated circuits. However, these integrated circuits have no manufacturing process at all, and many of them can still be soldered by hand. When imported chips are more expensive, this method is naturally possible, but as long as Midea can If ordinary chips and integrated circuit boards are produced in Hong Kong, the cost will be overwhelmed by labor. Even if Hong Kong's labor is cheap, it is impossible to compare with the fast placement machine.

"I have already discussed with the largest electronic watch manufacturers in Hong Kong. When our integrated circuit boards come out, they will buy some and put them on the market for testing. If there is no problem, they will purchase our products on a large scale. " Lei Shengli laughed.

"Well, electronic watches are indeed a huge market." Chen Zhiwen nodded and said, "If we win this market, our production technology will also be improved."

The semiconductor industry has a professional term called "yield rate", which is related to the quality of equipment, and also related to production management capabilities and experience. For example, in the 21st century, basically only TSMC and Samsung can make high-end chips in the world. Other manufacturers, In fact, you can also buy related equipment, but if you produce it yourself, it is impossible to compare with Samsung and TSMC in terms of cost, because years of production experience in large quantities of orders have allowed them to control the production error rate to the extreme. Being controlled by them basically has no chance.

For equipment such as radios and televisions, it is a bit difficult for manufacturers in Hong Kong to replace integrated circuit boards, because this means a major change in the entire structure. In addition, these manufacturers are low-end brands, and the TVs can be turned on. Will only seek high quality.

However, electronic watches must require chips and integrated circuit boards. In such a small space, only PCB boards can control the accuracy of time.The control circuit boards inside Hong Kong electronic watches are all imported from overseas, mainly from Japan, and the same is true for liquid crystal panels. These two main components are the biggest cost of electronic watches. There are so many electronic watch companies in Hong Kong, but in fact they are not Just working for a Japanese brand.

"Chen Sheng, there is a debate within us. Some people think that we can also make this electronic watch. Last year alone, the export of electronic watches in Hong Kong was as high as 300 million. If we do it, one million should not be a problem. Increase our brand awareness." Lei Shengli said.

"Make electronic watches?" Chen Zhiwen smiled and shook his head and said: "No, the core of this thing is actually LCD, chips, and batteries. There are many factories in Hong Kong, but they are just to make money for assembly. We can make it, but The price/performance ratio is too low, it’s better to make chips with peace of mind, and in the future, liquid crystals will also be involved.”

If the electronic watch can always exist, even if it is assembled, it is meaningful to invest in it, but it is obviously impossible, and the speed of upgrading electronic products is too fast.

And the most important thing is that the electronic watch is small in size, and both the freight cost and the booth cost in the mall are very low. This also leads to the fact that the terminal retail advantage created by Chen Zhiwen is basically useless, which is completely different from the electric fan. Electric fans are also low in value, but the cost of terminal retail is high, because a large location is required to place the fan. As long as the terminal is controlled and the cost and quality are good, it is basically stable.

Nowadays, the price of electronic watches is quite high, generally between 10-30 US dollars, but in a few years, when the production of integrated circuit boards, chips and liquid crystals undergoes several iterations, the price will immediately drop to 1-3 US dollars. Between US$[-] is a very small profit, and even the Japanese electronic watch brand in the past two years has been forced to let go, because the brand has no effect on electronic watch products, and they are all new brands, purely for checking time , Consumers basically only look at the price.

Faced with the market that is about to collapse in a few years, Chen Zhiwen is of course not interested. Now it is important to use this market to develop his own chips, integrated circuit boards and future liquid crystal technology. By the 80s, household appliances The market followed suit.

"LCD? Do we want to make LCD too?" Lei Shengli asked quickly.

"Yes, LCD can also be made. There are no restrictions on this thing from the European and American governments. Just buy the equipment. You can arrange someone to go to the United States to buy a set of equipment, plus some technical patents." Chen Zhiwen nodded and said.

Chips and liquid crystals are one of the most important hardware for the entire electronics industry in the next few decades. They are both in the initial stage, and the cost of participation is also very low, and the restrictions in the United States are not high. At least before the 90s, they should all be There will be no major problems.

After the arcade machine has made enough profits, it is natural to enter these two fields. In fact, even the most expensive production line only needs a few million dollars today. For Midea, it is just a drop in the bucket.

"As far as I know, LCD production lines have a very large demand for fresh water. If we open an LCD factory in Hong Kong, will there be any problems in this regard?" Lei Shengli asked worriedly.

"No, our current production capacity is not very large, we can just buy water directly, but for sewage, we may need to invest a little money." Chen Zhiwen shook his head and said.

In the 60s, Hong Kong’s fresh water resources were so tight that it was difficult to guarantee residents’ water, even bathing. This crisis also dealt a major blow to Hong Kong’s industry and economy. The Hong Kong government subsequently built a large reservoir and negotiated with the mainland government to buy water. , just slowed down.

With the support from the mainland, as long as there is no drought in eastern Guangdong, basically there will be no major problems. You must know that the Swire Group specializes in producing beverages for Coca-Cola that are sold in the South Asian market. It is also in Hong Kong, and Chen Zhiwen's Very Coke is also Similarly, unless the scale of the LCD factory is very large, there may be a problem of water shortage.

But the demand for liquid crystals in the 70s was not as high as the demand for fresh water. In the 80s, let's talk about it.

"That's good." Lei Shengli said.

"LCD and chips are not only for low-end products. When we are familiar with them and have enough engineers and technicians, we still have to attack mid-range chips. Not to mention supplying to foreign countries, they are our internal products. If we can It will also be a very big advantage to use its own chips and liquid crystals." Chen Zhiwen added.

Arcade machines, future home game consoles, computers, handheld game consoles, home appliances, etc. all need chips, integrated circuit boards, and some need liquid crystals. With our own chips and liquid crystals, we can develop step by step with stable customers. , the process must be very cautious, especially arcade machines, which make a lot of money, do not dare to change the chip at will if they are not fully sure.

"Understood, then I will arrange for someone to go to the United States to purchase an LCD production line. Regarding patents, I will check and make a decision." Lei Shengli nodded and said. Long ago, Chen Zhiwen said that the future of Midea will not depend on Capital opening up terminal retail and various creative ideas are only for short-term market development. If you want long-term development, you must develop core technologies.

After all, no matter how strong the financial resources are, they can only open up two supermarkets, Wal-Mart and Costco. If you want to enter hundreds of large supermarkets around the world, you can only rely on technology, quality, and cost. No capital can control so many supermarkets. Large supermarket chains, even the ancient European and American super families are impossible.

Liquid crystals, chips, and integrated circuits are the core technologies. If they are well developed, they can not only be useful to their own products, but also can be sold to others to reduce their own costs while obtaining other profits.

"It's best to go to RCA. They are the founding company of LCD. They still have underlying patents. They should also have LCD production lines, and they may be the latest ones. It's just that they can't compete with Japan." Chen Zhiwen said that the United States is very strong in many technologies. But the factory management is much worse than that in Asia. As a result, the technologies developed by American laboratories over the years are all cheaper than Japanese industries.

It is said that the chip industry developed very well in the United States in the early days. Giant companies such as Intel, Texas Instruments, and IBM monopolized the global market. The yield rate was not high, but it was not a problem. The yield rate has been controlled to an extremely high level within a short period of time, and the normal market competition in the future will naturally beat European and American counterparts.

"Okay, I understand." Lei Shengli agreed.

PS: Regarding the chip issue, I know you will have doubts in the last chapter, but in fact, the chip market is definitely not limited to mobile phones and computers. These two are the most profitable chip products. Samsung and TSMC monopolize this segment, but the high-end chips Next, there are also a large number of products that need chips, such as automobiles, industries, home appliances, military industries, etc., especially for automobiles. After the rise of trams, the demand for mobile phones is greater than that of mobile phones at its peak. I am engaged in automobiles.

Therefore, to make chips, you don’t necessarily need to be the highest-end, and the middle and low-end basically have no restrictions, and there is no control. However, before the rise of automotive chips, ordinary chip companies were indeed struggling and suffered long-term losses. Saying is not a problem.

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(End of this chapter)