(Yicai) Dec. 8 -- Chinese auto manufacturer BYD and semiconductor giant Huahong Group are taking over two separate projects for integrated circuit factories in Chengdu that were deserted by their original investors as the capital city of southwestern Sichuan province looks to bolster one of its key industries.

Huahong has taken over the project started by US semiconductor firm GlobalFoundries in February 2017, staff members told Yicai. They began work on a new plant to the west of the original factory on Dec. 6, they added.

GlobalFoundries planned to build a 12-inch chip factory with an area of 450,411 square meters in the Hi-tech Comprehensive Bonded Zone, and invested around USD9.1 billion in the project. However, three years later, the New York-based company walked out, citing business reasons.

Meanwhile BYD has almost finished construction on the main building of the BYD Industrial Park on the site of a CNY200 billion (USD28 billion) memory chip manufacturing base that Tsinghua Unigroup said it would build in April 2017 but never finished.

In July, the Chengdu government teamed up with Shenzhen-based BYD and the following month a company called BYD Semiconductor Chengdu was incorporated at the site where Beijing-based Tsinghua Unigroup had been building. Recruitment should start early next year, a staff member said.

Generous Incentives

Chengdu is home to more than 270 semiconductor firms, including industry leaders Intel, Texas Instruments, Chengdu Higon Integrated Circuit Design and H3C. But although the city boasts a relatively complete industrial chain from IC design, manufacturing and packaging to testing, it still has noticeable shortcomings in manufacturing and design compared with the industry clusters in the Yangtze River Delta and Pearl River Delta.

Chengdu is committed to making up for these weaknesses and is offering generous incentives to support the industry.

Semiconductor firms can receive up to CNY500 million (USD70 billion) of all-round support, said a manager in the general electronics division of the Chengdu Municipal Bureau of Economic and Information Technology. And a wafer manufacturer providing foundry services for IC companies can get up to CNY10 million in support.

The municipal government is offering CNY500,000 (USD69,878) per year and a one-off CNY3 million (USD419,268) award to top talent, and a core team with highly qualified staff can receive CNY15 million (USD2 million) of bonuses, he added.

Editor: Kim Taylor