Beijing-backed Tsinghua Unigroup’s chip projects hit by delays

Beijing-backed Tsinghua Unigroup’s chip projects hit by delays

Chipmaker faces cash crunch as local governments temper support

TAIPEI — Two high-profile chip projects led by Chinese tech conglomerate Tsinghua Unigroup have hit significant delays, Nikkei Asia has learned — a further sign of the problems affecting the company now that Beijing is becoming more careful about picking winners in its race for tech supremacy with the U.S.

For years, Tsinghua Unigroup enjoyed unstinting support from the central and local governments as it pursued Beijing’s ambitions of creating a domestic semiconductor industry.

Now the conglomerate “does not have enough money” to keep one of its most ambitious new chip projects going while a second project is also on hold, sources have told Nikkei Asia.

Tsinghua Unigroup missed a Nov. 15 deadline for repaying 1.3 billion yuan ($198 million) in private debt and is facing billions more in bond payments in the coming months.

The company’s troubles, industry insiders say, are a sign that the days of unlimited policy support are over, and Beijing is now focusing its resources on fewer, more promising semiconductor projects.