Chip sales in China could overtake the EU and Japan next year • The Register - Market News
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Chip sales in China could overtake the EU and Japan next year • The Register

Chip sales in China could overtake the EU and Japan next year • The Register

China’s cold war with the US over chips is not slowing the country’s rapid growth in semiconductors, the Semiconductor Industry Association said this week.

The US sanctions against Chinese companies did not have the intended effect of restricting China’s semiconductor industry. In fact, the saber rattling only serves China to get its action on semiconductors in order, the industry association warned.

China’s semiconductor industry sales were $39.8 billion in 2020, up 30.6 percent from 2019, the SIA said. said. In 2015, chip sales in China were just $13 billion, or a 3.8 percent market share.

Sales figures for 2021 were not available. But the SIA predicts that if China maintains that growth rate, it could surpass the EU and Japan as early as next year and close the gap with the US and Korea, whose forecasted sales through 2025 are on a largely declining or flat curve.

The SIA pointed to China’s preference for sourcing homegrown technology as the reason for the boom in the chip sector. The trade wars with the US, which discouraged chip companies from doing business in China, have also revitalized the domestic chip sector with funding and incentives.

China quickly recognized semiconductors as the foundation for its electronics industry plans, prioritizing their development much earlier than the EU and US, which focused on domestic semiconductor facilities only after being hit by shortages.

Some Chinese organizations on the list of US entities, including the Chinese Academy of Sciences, are: develop Homegrown CPUs based on RISC-V. China Mobile this month deployed a chip from the Chinese company Phythium – which is also on the American Entity List – in the cloud.

The combined revenue of China’s CPU, GPU and FPGA sectors was about $1 billion in 2020, up from $60 million in 2015, the SIA wrote. About 15,000 companies in China are registered as semiconductor companies, most of them fables.

To be sure, China’s path to becoming a semiconductor powerhouse has had many problems, with scam and many outdated chips making efforts. Many of the chips developed by Chinese companies like Loongson and projected for PCs and servers are mainly used in IoT and embedded devices.

But the larger tech organizations in China are putting resources into making chips. Alibaba last year imported the server chip race with a 5nm part, and Baidu is develop a 7nm server CPU.

A lack of advanced fabs has put China at a great disadvantage. The US has placed China’s largest chip company, Huawei and top manufacturer, SMIC, on the Entity list, and Chinese semiconductor companies are now pushing capital to mature manufacturing technology.

SMIC planned to acquire EUV technology from Dutch advanced lithography company ASML, but that was canceled in 2019 due to US sanctions. EUV technology could have helped close the manufacturing gaps at companies like TSMC and Samsung, and SMIC is instead adopting legacy lithography tools from ASML to make chips.

“All indications are that China’s rapid growth in semiconductor chip sales is likely to continue, largely due to continued central government efforts and robust policy support in the face of deteriorating US-China relations,” the SIA said. . ®