SHANGHAI, China Applied Materials Inc. is planning to invest $83 million to ramp up its first product development center in China, which opens Friday.
The company said the establishment of the new center means it's moving beyond simple sales and service to technology development and sourcing. The new center will be located in Xian, central China. Applied Materials is spending $33 million in the first phase and roughly $50 million in the second phase, two to five years from now.
Applied has been considering such a center for several years in a effort to reduce costs. One of its earlier, abandoned efforts ended up spawning a competitor, Shanghai-based Advanced Micro-Fabrication Equipment Inc. Founded by former Chinese employees of Applied, AMEC is angling to be a local supplier to firms like Semiconductor Manufacturing International Corp. and Grace Semiconductor Manufacturing Co. AMEC is developing dielectric chemical vapor deposition (CVD) and dielectric etch systems for 300-mm production.
Last year Applied Material opened a support center in Xian to provide engineering and software support services. In 1984, Applied Materials (Santa Clara, Calif.) established a presence in China and now has offices and centers in Shanghai, Beijing, Tianjin, Wuxi, Suzhou, and Kunshan.
Applied Materials continues to concentrate its volume system manufacturing in Austin, Texas, and the majority of its product development in California's Silicon Valley.