Chapter 233: Priced at US$4,500, determined not to engage in price war!

Author: The bright moon once shone on the ancient river

Chapter 233: Priced at US$4,500, determined not to engage in price war!

"Lao Yu, when you go to Shanghai, you can first hand over part of the Kirin 620 production order to Shanhai Microelectronics, and set the proportion at 30%.

As for the price, I’ll just ask the other party for a quote and I’ll make my own decision.”

Huayao CEO Bao Jianbai warned.

"Boss, please don't let Mr. Liang go. He's not familiar with the wrong thing."

Yu Dong excused himself.

He is the president of the wireless product side. That job should have been handled by Liang Ye of HiSilicon Semiconductor, but now it falls to him, and he is unwilling to do so in every possible way.

"To be considerate of Yidong, Lao Liang went to Bay Semiconductor Manufacturing Co., Ltd. to discuss contract processing cooperation next year. He thought again and again and felt that Chen Heyu and I had the most contact, so he assigned me the task."

Bao Jianbai explained that he would rather be led by Yu Dong himself so that he could rest assured.

"Boss, I'm sorry that I don't know Chen Heyu very well. It's okay to have a relationship, but if you want to do it for a very high price, there's no way."

Yu Dong smiled bitterly.

In the negotiations for Moss's second-generation Chico voice system, at first he wanted to use Huayao's size and connections as bargaining chips to force Chen Heyu to lower the licensing fee.

Who would have thought that people would ignore him at all, just pay the price set by future technology, and just go out and get out of here?

The depressed mood was still fresh in his memory!

"As for the Meijiang Group, please do not exceed 15% of the cost of Bay Semiconductor Manufacturing Co., Ltd., and I will make a decision directly."

Bao Jianbai said with a smile.

"Could it be?"

Yu Dong's mind turned around, and he immediately thought of the reason behind it, and whispered for confirmation.

"Yes, the big boss here has sent a message, asking for some orders to support the development of domestic chip foundries."

Bao Jianbai nodded and spoke concisely and concisely.

"He knows what to do, boss, don't worry."

Yu Dong smiled slightly, turned around and left, intending to attract the manager of HiSilicon's supply chain management department. In this way, Liang Ye would not gossip.

…

"Mr. Chen, Huayao, Lianxiang, and Zhongxin have all expressed their intention to cooperate and want to hand over some of the chip processing orders to Shanhai Microelectronics, but how should they set the price?

He and Mr. He are a little unsure whether to use the cost pricing method or the market anchoring method?"

In the conference room, Wang Maosong asked with a confused look on his face.

"What do you think, Mr. He? Do you have a detailed pricing strategy?"

Chen Heyu did not reply directly, but instead posed the question to He Tingbo.

"Boss, the current production cost of each 8-inch wafer is 6,000 Chinese dollars, taking into account cost factors such as silicon wafers, equipment depreciation, manpower, factory infrastructure damage, water and electricity, etc.

The company needs to retain a gross profit margin of more than 50%, so the processing price should be set at more than 24,000 per piece to meet the requirements."

He Tingbo asked calmly whether this complied with the cost pricing method.

"What's Mr. Wang's opinion?"

Chen Heyu continued to ask.

“As for the OEM price of 8-inch wafers, Lotus Technology quotes US$5,200, Bay Semiconductor’s price is US$5,100, and GlobalFoundries quotes US$5,600.

He believes that the prices of competing companies should be comprehensively considered, and the yield rate should be included in the floating impact value. The price is US$4,100, which is about US$300 cheaper than Bay Semiconductor Manufacturing Company."

Wang Maoshu paused and said.

Shanhai Microelectronics' equipment is old and its yield rate is 80%, while Bay Semiconductor's yield rate is around 90%.

If the processing cost is calculated per wafer, it is because there will be a certain loss rate during the chip manufacturing process.

Taking into account various cost factors, foundry manufacturers will strongly demand calculations based on the number of wafers as to whether to speed up the recovery of investment costs.

However, the yield rate of Shanhai Microelectronics is 88% of that of Bay Semiconductor. Regardless of other impact values, the most reasonable price is US$4,400-4,500.

However, Wang Maosong's plan is obviously to seize the market at a low price, but that is not what Chen Heyu wants.

One is 24,000 Chinese dollars, the other is 4,100 US dollars, there is not much difference!

"Why do you want low prices? Is the 28-nanometer market saturated? Is the logic technology mature?"

Seeing that the two people's ideas were very different from his, Chen Heyu asked in a deep voice.

"Boss, is Shanhai Microelectronics the most effective way to compete for market share in a price war..."

Wang Maosong went to explain.

"Reducing prices can attract those companies that are price-sensitive, but it cannot cultivate loyal users. What should we do if there is no profit margin for everyone in the end?"

Chen Heyu interrupted him directly and then asked.

With the advancement of technology, more and more manufacturers are mastering 28nm, and the processing fees they can earn will become less and less.

Before his rebirth, the processing fee for 28-nanometer chips was only US$2,000, which was more than halved.

"That's $4,300?"

Wang Maosong tentatively said.

In my mind, I thought that if he was the person in charge of sales and marketing, he would be able to expand his performance if he had an advantage in price.

"28nm is not the end of Shanhai Microelectronics. They have a more important task. Only by using the 14nm process can they be qualified to set prices."

"It's $4,500. Considering the difference in yield, please note the statement when signing the contract. After Shanhai Microelectronics improves the yield, we have the right to adjust the price."

Chen Heyu said.

If you walk ahead and eat meat, if you follow behind you drink soup, whoever seizes the cutting-edge and high-precision chip market first will make money easily.

Although in 2015, 28nm was considered a mid-range chip process globally and was an advanced logic technology.

But in less than five years from now, the process technology will become more and more advanced, even entering the 5-nanometer field. By then, the market space of 28-nanometer will shrink sharply, from US$30 billion to more than US$10 billion.

There is absolutely no need for price wars to consume each other's resources.

"No, boss, they are bright."

He Tingbo made a statement, and the pressure was put on Wang Maosong. How to get more orders at the same sales price would test the level of the sales department.

…

Peninsula Hotel Shanghai.

In front of the splendid gate, luxury cars were constantly parked. Wang Maosong and the marketing director were greeted with smiles in the lobby on the first floor in front of the station, receiving one after another big bosses.

President of Haotong Greater China!

Executive Director of Intelligent Greater China!

President of Huayao Wireless Business!

Chairman of Sanxing Dahua Semiconductor!

Procurement Director of HOC Chip R&D Center!

Secretary Zhou of Pudong Electronic Port!

Among them are not only the powerful secretaries in charge of the economy, but also overseas chip giants.

Generally speaking, there are four types of companies in the chip track liquid industry.

The first, Fabless mode: Fabrication (manufacturing) + Less (none), means whether it is engaged in chip design and sales, and does not involve industrial operations in manufacturing, packaging and testing links. Apple, Haotong, and HiSilicon are not involved in this type.

kind.

The second type is the Foundry model: manufacturers that are responsible for chip production and manufacturing but do not have chip design capabilities, that is, foundries, such as Shanhai Microelectronics, Bay Semiconductor Manufacturing Co., Ltd., and GlobalFoundries belong to that camp.

The third, IDM model: combined with the first two operating models, can fully control the design, manufacturing, packaging, testing and sales of chips. It has many advantages and disadvantages, such as high investment costs and slow payback cycles.

None of these companies are truly multinational groups like Intel, Sanxing, or Texas Instruments.

The fourth, OSAT model; is responsible for the chip packaging and testing business, the bottom of the profit chain, proper wage earners, there are many such companies in China, because compared with design and manufacturing, chip packaging and testing is as difficult as

The complexity is greatly reduced.

Therefore, it is not difficult to see that most of the companies and representatives participating in the exchange meeting tomorrow want to know whether Shanhai Microelectronics' chip technology is mature and whether it can be mass-produced.

As for the Eastern OEM orders, I am not in a hurry and will take a wait-and-see attitude.

"Mr. Yu, welcome. You can go directly to the banquet hall on the 8th floor by taking the elevator."

He Tingbo and Yu Dong shook hands and exchanged greetings.

"Is Mr. Chen downstairs?"

Yu Dong asked.
To be continued...