Canada’s semiconductor sector has recently seen an influx of investment and momentum while looking to expand its relationships south of the border and capitalize on the CHIPs Act. But a formal industrial policy is essential to propel it forward.

In a recent virtual chat, Hudson Valley FastFab chair and CEO Dick Thurston and Jim Bark, partner with DNA Global, discussed the key ingredients necessary for Canada to ramp up its semiconductor manufacturing capabilities as they look to build a mature node fab in Canada.

Canada’s history in semiconductors goes back to the 1960s, Thurston noted, and there was a great deal going on through 1990s, including engineering, research and development, university activity, and the good and bad of Nortel. “There’s a lot of good lessons learned that are applicable today,” he said.

Thurston added that the ongoing conflicts occurring in the global semiconductor industry means Canada has a very promising future playing a much different role than it has historically. “Canada has a very exceptional DNA.” He said “DNA” stands for diplomacy, nodes and allies, while adding “design” and “development” are also the country’s strength.

The “A” could also stand for alloys, Thurston said, as Canada is home to critical minerals that are essential to the semiconductor industry.

He added that Canada has a tremendous base for future growth in the semiconductor ecosystem and supply chain, which is exemplified by the presence of IBM’s advanced packaging group in Quebec, as well as organizations like MiQro Innovation Collaborative Centre (C2MI).

The other key ingredient for a successful semiconductor industry is government leadership, Bark said. “There’s no country in the world that does semiconductors where the government didn’t actually initiate the sector, invest in the sector and create it,” he said. “If Canada wants to get into semiconductors, our governments are going to have to take the lead.”

Bark said the CHIPs Act south of the border is an opportunity for Canada as the U.S. looks to pull back semiconductors from Asia. “It’s almost taking it too far back and is trying to do the entire supply chain on its own,” he said. “When you try to do the whole thing yourself, you’re bound to fail.”

Canada can help the U.S. by becoming a partner even as it becomes more isolationist, Bark added. “We’re the friendly partner that allows other countries to view North America as a block rather than the U.S. as this giant entity that is hard to crack into.”

Thurston said Canada also needs a large, much more focused industrial policy, as does the U.S. “It’s kind of haphazard in the CHIPS Act but doesn’t go to the level that I think can be done and Canada’s DNA does allow.”

Thurston said Canada is doing a good job at the federal level on the ground in the U.S. to promote its capabilities and sees Canada’s diversity and young creativity helping to drive the semiconductor industry forward, which is being cultivated in the country’s universities.

When it comes to what Canada should be building, Thurston said the country should start with a 200-mm fab while continuing to create the necessary building blocks to support manufacturing, including workforce development. “When you look at everything that’s going on with quantum, with photonics, you name it, Canada could be the leader,” he said. “You start with the right manufacturing base and then build upon it. That’s where I think the industrial policy should focus.”

Semiconductors need to be seen by Canada as “foundational” in the same way the food and energy sectors are, according to Bark. “It’s going to be embedded in everything,” he said. “Every other sector, including automotive, is derivative of the three.”

Depending on the wins and changes in the mood of society, Bark said a sector that might be hot today could disappear tomorrow. “We’re always going to need food, we’re always going to need energy, and we will going forward always need semiconductors,” he said. “From a government industrial policy and economic policy standpoint, if you’re going to pick any sector to invest in, I would pick either energy or semiconductors.”

By: DocMemory
Copyright © 2023 CST, Inc. All Rights Reserved