➀ China accounted for 31% of global manufacturing output in 2022; ➁ Its manufacturing sector's value added exceeded $5 trillion, contributing nearly 30% to the country's total economic output; ➂ China's manufacturing dominance is so significant that its output matches the combined output of the next seven largest manufacturing countries.
Recent #China news in the semiconductor industry
➀ China responds to Trump's 10% tariff proposal with a 20% price cut on domestic products; ➁ Beijing's policy may negatively impact chipmakers such as Nvidia and Intel; ➂ Chinese industry associations call for reduced reliance on American chips.
➀ Despite U.S. sanctions and China's localization efforts, Chinese companies remain reluctant to adopt domestic chips; ➁ The reluctance stems from technological limitations, availability of reliable foreign alternatives, and lack of government requirements; ➂ AI and HPC sectors are particularly challenging, with limited access to advanced technologies and domestic alternatives struggling to compete.
➀ Intel CEO Pat Gelsinger is leaving after three years; ➁ The U.S. imposes trade restrictions on 140 Chinese companies involved in technology trade; ➂ Anduril Industries wins a contract to modernize the U.S. Space Surveillance Network (SSN); ➃ BAE Systems plans to recruit over 2,400 staff in the UK; ➄ Microchip announces the closure of its Arizona wafer fabrication facility.
➀ Five new SiC-related projects have been announced with an investment exceeding 200 billion yuan;
➁ Tarq Semiconductors and HCL's Vama Sundari Investments are investing 27.65 billion yuan in two semiconductor manufacturing factories in Yeadon, India;
➂ Shanghai Fuanyuan Technology Co., Ltd. is investing 115 million yuan in a SiC module packaging equipment R&D and production project;
➃ Huaxin邦 is investing in a SiC chip advanced packaging process line in Haikou, Hainan Province;
➄ Powerex has received 2 million yuan in subsidies from the U.S. Chips and Science Act to expand SiC module production lines;
➅ Heraeus has opened a ceramic substrate factory in Changshu, Jiangsu Province.
➀ China's entry into the WTO in 2001 marked its rise as a crucial player in the global supply chain; ➁ Over the past 23 years, China has become the top exporter in the world, with exports increasing 13.6-fold; ➂ The success of China's transformation is attributed to abundant labor, favorable government policies, and substantial infrastructure investments.
➀ The US imposes trade restrictions on 140 companies involved in technology trade with China, including SMIC and Huawei. ➁ Three Chinese semiconductor equipment manufacturers are also targeted. ➂ Products from Samsung, Hynix, and Micron are banned. ➃ The move is part of the Biden-Harris administration's targeted approach to hinder China's indigenous production of advanced technologies. ➄ New rules are established to stop the export of products containing US components to China.
➀ The US government has imposed export controls on high-bandwidth memory (HBM) and semiconductor equipment to China to prevent China from acquiring key components for AI development.
➁ The US Commerce Department's Bureau of Industry and Security (BIS) announced the addition of specific HBM products to the list of controlled items.
➂ The controls apply to products with memory bandwidth density of over 2 gigabytes per square millimeter per second.
➀ Trump announced a 10% tariff increase on nearly all Chinese imports as a countermeasure against synthetic opioids 'fentanyl' flowing into the U.S. through Mexico and other countries;
➁ Trump also said he would sign a presidential order to impose a 25% additional tariff on Canadian and Mexican goods on January 20, 2025, and this measure will last until the fentanyl and illegal immigration issues are resolved;
➂ Trump has made illegal immigration a major campaign issue and has explicitly stated that he will use the 'tariff' tool to the fullest to address this issue.
1. Chinese stocks surged in September and early October due to stimulus measures; 2. MCHI reversed lower after a massive gain, down 14.5% by Election Day; 3. Baidu and Alibaba have experienced round-trip movements in the past couple of months.
➀ China warns Japan over increasing semiconductor sanctions; ➁ Threatens to block essential manufacturing materials; ➃ Japan's automotive industry may be affected by Chinese retaliation.
➀ ST has revised its long-term financial targets, pushing the $20 billion revenue target from 2027 to 2030 due to weaknesses in the automotive and industrial markets. ➁ For 2027-28, the revenue target is now around $18 billion with an operating margin of 22-24%. ➂ CEO Jean-Marc Chery expects capex to decline over the next three years but emphasizes ST's position as the largest SiC chip seller and its AI revenue potential.
➀ STMicroelectronics, a European semiconductor giant, announces a collaboration with China's second-largest wafer foundry, Hua Hong Group, to manufacture 40nm microcontrollers (MCUs) in China to support its long-term revenue goals.
➁ STMicroelectronics expects to save millions of dollars by implementing manufacturing restructuring and cost basis adjustment plans, aiming for revenue of about $18 billion and an operating profit margin of 22% to 24% between 2027-2028.
➂ The company's CEO, Jean-Marc Chery, emphasizes the importance of local manufacturing in China, highlighting cost benefits, compatibility issues, and the risk of government restrictions. He also mentions the rapid development cycle of electric vehicles in China as a missed opportunity for any other production location.
➀ Huawei's Ascend AI chip progress stalls due to US sanctions; ➁ The 7nm node lags behind TSMC by eight years; ➂ Huawei struggles to secure EUV equipment from ASML.
➀ AMAT's Qtr performance meets expectations but outlook is weak; ➁ AI strength can't offset market weakness; ➂ Regulatory and China risks add uncertainty.
➀ The CEOs of Europe's top three chip companies discussed the challenges of doing business in China under US restrictions at the Electronica Forum. Jean-Marc Cheri, CEO of ST, highlighted the importance of China as a 30% revenue contributor and the need for stability in the supply chain. Kurt Sievers, CEO of NXP, emphasized that no country's chip industry could be independent or dominant, and warned about the potential increase in costs due to supply chain fragmentation. Jochen Hanebeck, CEO of Infineon, cautioned about the fragmentation on the supply side and the potential impact of tariffs.
➀ TSMC, the world's leading contract chipmaker, announced a suspension of production for advanced AI chips for Chinese customers; ➁ The suspension is in response to a U.S. Department of Commerce directive; ➂ The directive is pending an investigation into potential violations.
➀ Concerns over the impact of the U.S. presidential election and the ongoing chip war between China and the U.S. are likely to decrease China's semiconductor equipment spending to below USD 40 billion in 2025. ➁ The tension is expected to affect the global semiconductor supply chain. ➃ The situation highlights the importance of domestic semiconductor manufacturing capabilities.
➀ Qualcomm reported an upbeat first-quarter sales forecast; ➁ nearly 50% of its FY24 sales derived from China; ➂ expecting a 10% quarter-over-quarter revenue growth this quarter
➀ Samsung is reportedly reducing its foundry and legacy DRAM production; ➁ The South Korean semiconductor giant is considering selling outdated NAND equipment in China; ➂ Local Chinese companies are said to be potential buyers.