Due to the shortage of chips and the technological war between China and the United States, China’s semiconductor production in May hit a record high

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Release time: 2021-07-06 16:20:48

According to data released by the central government on Wednesday, in the face of a severe global shortage of semiconductors, China has made all-out efforts to produce chips, and the output of integrated circuits (IC) in May hit a record one-month high.

According to data from the National Bureau of Statistics, China's integrated circuit production in May increased by 37.6% year-on-year to 29.9 billion pieces.

In addition, according to the bureau's data, the country's car production last month fell by 5% year-on-year. Automakers have been particularly hard hit by the shortage of chips.

The chip output in May increased from 28.7 billion in April and 29.1 billion in March, indicating that Chinese IC manufacturers are operating at full capacity.

Although Chinese chip manufacturers cannot mass-produce advanced 14-nanometer node chips (the chips needed to power the latest iPhone models), Chinese chip designers and manufacturers can produce mature ICs for home appliances and automobiles .

According to data from the National Bureau of Statistics, in the first five months of this year, China's integrated circuit production volume was 139.9 billion pieces, a year-on-year increase of 48.3%.

At the same time, as downstream buyers scramble to stock up semiconductors, China's chip shortage continues. China's auto production in May fell 4% year-on-year to 2.1 million units, although new energy vehicle production surged 166.3% to 237,000 units last month.

The latest data confirms that China is sparing no effort to pursue self-sufficiency in semiconductors, even though the country currently relies heavily on imports and American technology to meet domestic demand.

A report earlier this month showed that compared with the same period in 2020, the number of newly registered chip-related companies in China more than tripled to 15,700 in the first five months of this year.

The emergence of a large number of new chip companies and the surge in production represent a wave of investment in the industry, which is attributed to subsidies and other incentives in Beijing.

The mainland foundry Semiconductor Manufacturing International Corporation (SMIC) has been sanctioned for allegedly having connections with the military-it denies the accusation. The company lags far behind Taiwan Semiconductor Manufacturing Co. (TSMC) in manufacturing advanced chips, while China is prohibited from acquiring Advanced lithography tools from the Dutch industry leader ASML.

However, the country is making progress in more mature areas, such as manufacturing chips using old process nodes and manufacturing memory chips. Although China's IC production has increased, the country is still importing more chips to meet industry demand. Compared with the same period in 2020, IC imports in the first five months of this year have increased by 30%, reaching 260.35 billion pieces, which is almost twice China's domestic production in the same period.

In March of this year, Beijing began to exempt taxes on imported semiconductor components and materials by 2030. In the US-China science and technology war, the world's second largest economy is redoubled efforts to promote chip development.

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