01 May 2023 -

Nikkei – China pumps $7bn into upgrading chip supply chain

made in china

Chinese chipmaking suppliers and state-backed funds are estimated to invest 50 billion yuan ($7.26 billion) in order to enhance the domestic supply chain, as the US has put a limit on tech exports, reports Nikkei Asia.

This has resulted in a decrease in imported chipmaking machines from foreign sources. In 2022, Chinese semiconductor companies used 35% of domestic equipment, which is a rise from the 21% in 2021, according to Chinese media. Also, domestic players have gained almost half of all public bids by leading chipmakers within the year 2023, as reported by a Chinese brokerage.

Naura Technology Group, the top manufacturer of chipmaking devices in China earned 14.6 billion yuan in revenue last year, more than six times the figure in 2017. With the backing of the state, the company acquired a U.S. wafer-cleaning device maker in 2018 and extended its business to include etching products.

Advanced Micro-Fabrication Equipment, the No. 2 manufacturer of chipmaking tools and a manufacturer of etching devices, increased its sales by five times from 2017 to 2022. Products of this state-backed enterprise can process 5-nanometer semiconductors. A plant worth 1.5 billion yuan is currently under construction in Shanghai.

It is estimated that sales of chipmaking equipment in China totaled 52 billion yuan last year, around six times more than in 2017. Moreover, the sales of chipmaking materials amounted to 62 billion yuan in 2022, nearly three times the figure of 2017. NSIG’s revenue roughly quintupled during that period, and the company raised 10 billion yuan in funds last year itself.

As per the data from SEMI, China ranked first worldwide in chipmaking equipment sales for the third consecutive year in 2022 despite a 5% decrease. It is expected that the demand will increase in 2023, especially in anticipation of new US export restrictions. SMIC has planned for the same level of investment in 2023 as in 2022.

To avoid electronics supply-chain disruptions, you may also wish to consult an expert in electronics component supply. With more than three decades of supply-chain expertise, Astute Electronics is ideally placed to work with you on your daily component requirements.

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

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