China’s memory chip makers are pushing ahead in the low-end market, although the country is unlikely to achieve self-sufficiency in the face of intense geopolitical conflicts and shortages. severe semiconductor shortage worldwide.
Yangtze YTMC and Changxin Memory Technologies represent a new disruptive force in the field. Economists from investment bank Natxis say they expect to increase global capacity by 29% between 2020 and 2022.
“Despite coming to a very low base, it is likely that some mainland Chinese companies will put pressure on the companies that are leading the market.“, Gary Ng, Asia Pacific economist at Natxis, revealed in an online meeting. He added that the expansion of low-end products by Chinese memory chip makers could create more downward pressure on suppliers in this sector.
As part of an industry upgrade plan called “Made in China 2025”, China has defined an ambitious goal: to achieve 70% self-sufficiency in manufacturing. semiconductor production by 2025.
This self-sufficiency dynamic has been further boosted amid growing tensions between the US and China over the technology sector, creating a good opportunity for domestic suppliers that already have a lot of technology. Weak technology is invested more heavily.
The global semiconductor crisis continues to cause many obstacles for the auto industry as well as many other sectors. As one of the global economic powers, including the US and Europe, China has planned to invest more aggressively to boost the semiconductor industry.
However, because the current semiconductor industry depends on a global supply chain that has been built over the years, almost no country has the ability to be fully autonomous.
In a report last month, global research and consulting firm Gartner predicted that this global chip shortage could last until the second quarter of 2022 as capacity in foundries remains relatively tight. narrow and not fully recovered.
Kanishka Chauhan, core research analyst at Gartner said: “Semiconductor shortages will severely disrupt supply chains and limit the ability to produce a wide range of electronic devices in 2021. Foundries are increasing the price of wafers, forcing chip companies to raise equipment prices..”
However, despite being a hurdle for some companies, the crisis has helped foundries globally achieve outstanding revenue. According to a recent report, research firm TrendForce said that quarterly revenue at the 10 largest foundries in the world hit a record high in the first quarter as demand for many devices skyrocketed.
Companies like TSMC have already started to increase capacity to cope with the shortage, but this could lead to the risk of excess capacity in the future, especially in the low-end memory chip segments where these companies Chinese companies are aiming for.
Gary Ng said: “There may come a time when supply exceeds demand. That raises the question of whether there are too many chips in the world.”
Le Huu according to SCMP