US-China tech war: chip maker Micron to close DRAM design operations in Shanghai, move key engineers to US, India
US memory chip giant Micron Technology has confirmed it will close its DRAM design operations in Shanghai by the end of this year, with industry sources saying some of the 150 Chinese engineers will be asked to relocate to the US or India.
Micron said in a statement on Wednesday that its DRAM engineering team "will vacate from the Shanghai Design Centre", with the process expected to be completed before December 2022, adding that the rest of its operations in the city would not be affected.
The company, which employs about 43,000 people globally, did not provide a reason for the decision. DRAMs, short for dynamic random-access memories, are a common type of semiconductor used in computers.
The move is a precautionary measure to prevent talent loss and technology leaks to competitors in China, according to employees and industry analysts.
A current Micron employee, who requested anonymity, said the plan was announced internally last month and that the decision was made because of a "historic loss of technical know-how as some former employees and management were poached by big tech firms in China".
The growing technology rivalry between China and the US also played a role, the employee said.
The employee said some of the 150 members of the Shanghai DRAM team can apply to be relocated, and successful applicants would be granted immigration packages to the US or India.
Zheng Hua, the former senior director of Micron's Shanghai Engineering Centre, announced on LinkedIn last week that he would relocate to Micron's Atlanta operation as site leader. Micron has research and development centres in the US, Singapore, Japan, Taiwan, Italy, China, India and Germany.
Wang Lifu, a Shanghai-based analyst at semiconductor consultancy ICWise, said the closure of the design centre in Shanghai "could be a preventive measure" against technology leaks.
"Many US memory chip design companies opted to put their design teams outside China in the first place, and Micron is moving in that direction," Wang said.
Chen Rang, a long-time investor and entrepreneur in China's semiconductor industry, said Micron's Shanghai team has lost more than a third of its 300 members. With other chip design companies in China poaching its employees with high salaries and stock options, Micron's move to relocate was "unsurprising", he added.
It is increasingly common for chip companies to become aggressive in recruitment amid a surge in demand for top talent, according to Chen.
Micron has previously cited its concern over the government-backed competition in China. In its 2021 annual financial report, the company warned investors that Beijing's support for domestic DRAM makers could restrict Micron's growth in the market.
"We face the threat of increasing competition as a result of significant investment in the semiconductor industry by the Chinese government and various state-owned or affiliated entities that are intended to advance China's stated national policy objectives," Micron said in the report released last September.
The move is a precautionary measure to prevent talent loss and technology leaks to competitors in China, according to employees and industry analysts.
A current Micron employee, who requested anonymity, said the plan was announced internally last month and that the decision was made because of a "historic loss of technical know-how as some former employees and management were poached by big tech firms in China".
The growing technology rivalry between China and the US also played a role, the employee said.
The employee said some of the 150 members of the Shanghai DRAM team can apply to be relocated, and successful applicants would be granted immigration packages to the US or India.
Zheng Hua, the former senior director of Micron's Shanghai Engineering Centre, announced on LinkedIn last week that he would relocate to Micron's Atlanta operation as site leader. Micron has research and development centres in the US, Singapore, Japan, Taiwan, Italy, China, India and Germany.
Wang Lifu, a Shanghai-based analyst at semiconductor consultancy ICWise, said the closure of the design centre in Shanghai "could be a preventive measure" against technology leaks.
"Many US memory chip design companies opted to put their design teams outside China in the first place, and Micron is moving in that direction," Wang said.
Chen Rang, a long-time investor and entrepreneur in China's semiconductor industry, said Micron's Shanghai team has lost more than a third of its 300 members. With other chip design companies in China poaching its employees with high salaries and stock options, Micron's move to relocate was "unsurprising", he added.
It is increasingly common for chip companies to become aggressive in recruitment amid a surge in demand for top talent, according to Chen.
Micron has previously cited its concern over the government-backed competition in China. In its 2021 annual financial report, the company warned investors that Beijing's support for domestic DRAM makers could restrict Micron's growth in the market.
"We face the threat of increasing competition as a result of significant investment in the semiconductor industry by the Chinese government and various state-owned or affiliated entities that are intended to advance China's stated national policy objectives," Micron said in the report released last September.
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