15 Jan 2024 -
 General

China’s chip output may double in five years – Barclays analysts

Trendforce Chinese fab graphic

Is the global electronics industry on the cusp of a seismic shift as China embarks on a remarkable expansion of its chip production capacity? Analysis by Barclays reported by Bloomberg reveals that China’s chip manufacturing capacity is expected to more than double within the next 5 to 7 years, surpassing market expectations significantly.

The graphic published by TrendForce shows the spread of Chinese production – currently 44 wafer fabs, with 25 of them being 12-inch facilities, 4 of them 6-inch, and 15 8-inch wafer fabs/lines. Additionally, there are 22 wafer fabs under construction, with 15 of them being 12-inch facilities and 8 being 8-inch wafer fabs.

Insiders say, “There are materially more local semiconductor manufacturers and fabs in China than suggested by mainstream industry sources.” 

Although not at the forefront of the innovation, Tom’s Hardware points out that these production nodes “are used for a wide range of applications, from home appliances to automobiles, which is why they remain in high demand and will remain”.

China’s chipmaking ascent is not without its challenges and uncertainties. The rapid expansion of domestic production could intensify competition in the global chip market, potentially leading to price wars, market consolidation, and challenges for established chip manufacturers.

TrendForce concludes, “With China’s mature process capacity expected to grow from 29% to 33% by 2027, driven by policies promoting local production, giants like SMIC and HuaHong Group are anticipated to lead the charge, potentially causing a flood of mature processes into the global market and triggering a price war.”

Thousands of senior engineers and procurement professionals subscribe to our LinkedIn Market Intel newsletter – get yours here

For more help with looking at supply chain options, contact Astute Electronics

Related News

14 Jun 2024 - Defence

Webinars for Defence, Military, and Aerospace Engineers 

Read more

12 Jun 2024 - General

Electronics industry surges forward into 2025

Read more

07 Jun 2024 - General

Nvidia’s dominates – for now. A look at alternatives.

Read more

06 Jun 2024 - General

The CHIPS Act’s $39 billion challenge: building Fabs is easy, finding talent is not

Read more

05 Jun 2024 - Defence

New Events Series for Defence, Military, and Aerospace Engineers 

Read more

04 Jun 2024 - General

What is Taiwan’s Silicon Shield, and is it so tough?

Read more