Hey everyone! I hope you have a wonderful holiday season ahead. I’m Cheng Ting-Fang, this week’s #techAsia host.
I recently had a year-end gathering with a friend who has extensive experience in China’s semiconductor industry. He was traveling to Taiwan for work, and we discussed the industry’s chip expansion plans. Despite China’s macroeconomic slowdown, he said it was a busy year, with him frequently visiting three cities in two days to meet customers eager to buy semiconductor manufacturing equipment. What is noteworthy is that not only new chip manufacturers are emerging, but also silicon wafer and material manufacturers. Many university-led research centers in China have also built clean rooms and provided chip test production services.
“While the United States has effectively suppressed China’s advanced chip production through export controls, China is rushing to increase production capacity in not-yet-restricted parts of the chip and related supply chain,” said an industry veteran. .
Globally, the chip industry’s recovery has been uneven. Although demand for cutting-edge AI chips remains strong, sectors such as consumer electronics, industrial and automotive applications have not yet fully recovered. Many chipmakers, including Intel, Wolfspeed and Nanya Technology, are delaying machine purchases or postponing expansion plans due to weak demand.
This is reminiscent of past cases where China’s aggressive expansion in areas such as solar power equipment, LEDs, and displays led to intense price competition and financial hardship for many companies. The scale of the expansion is even more worrying for the tech community.
China is now gradually becoming better equipped to provide more cost-effective solutions for a wide range of electronic components, including chips, chip substrates, and printed circuit boards.
Industry executives liken the fierce competition in the Chinese market to a “pot of super-rich soup.” Despite the trend of technological decoupling between the US and China, the rise of domestic suppliers is likely to impact global demand and supply dynamics. With memories of past financial pain still fresh in their minds, the question many business owners are now asking themselves is, “Who’s next?”
5 years of battle
More than five years after the US added Huawei to its trade blacklist, where does China’s technology champion stand? An exclusive report shows how Huawei has become a technical advisor to production partners across China, actively helping chip and technology companies improve their technological capabilities.
“If you take a closer look at some of the chipmakers and high-tech companies that are currently developing more advanced technologies in China, there are still very many people who find the shadow of Huawei,” one semiconductor industry executive told Nikkei Asia. told.
Huawei continues to lead in R&D efforts and technology development in China, according to interviews with multiple industry insiders.
One notable example is SJ Semiconductor, a little-known company located in Jiangyin, along the Yangtze River. Huawei has undertaken an elite task to assist SJ Semiconductor in developing advanced chip packaging capabilities that mirror TSMC’s CoWoS technology, the industry gold standard adopted by NVIDIA and Amazon for their latest AI chips. We sent the Force.
This week’s feature offers more exclusive examples of Huawei’s work, as well as visually rich graphics mapping China’s supply chain progress. Please enjoy it.
looking for hands
TikTok chief executive Sho Zhi Chiu met with Donald Trump on Monday in Mar-a-Lago, Florida, as the popular video app is rescued by the president-elect from a possible U.S. ban. We expect that, writes Hannah Murphy of the Financial Times.
ByteDance-owned apps will be banned from the company’s 170 million U.S. users unless they separate from their Chinese parent company under a law that goes into effect on January 19, the day before Trump’s inauguration. . TikTok has said selling its shares is technically impossible. The Chinese government says it will block such a move.
TikTok has been fighting its Chinese parent company in court, citing national security concerns, but with little success. Recently, a U.S. Court of Appeals rejected both a challenge to the law and a subsequent request to suspend the law. TikTok has now filed a new petition asking the Supreme Court to suspend the law.
If that fails, Trump is the best hope. He has already vowed to “save” the app, saying on Monday that he has “a little fondness” for TikTok, citing its overperformance with young voters in the November election. Ta. It’s unclear how he will do this or whether ByteDance or TikTok will make any concessions to stay in the United States.
Automakers need to know about chips
Synopsys CEO Sashin Ghazi said in an exclusive interview with Nikkei Asia’s Chen Tingfang that as cars become more interconnected and electrified, automakers are looking to differentiate their products. He said there will be an increasing need to develop in-house chip expertise.
The CEO said this also applies to companies developing automation solutions and robots, emphasizing the importance of integrating software and specialized chips to create products that stand out from the competition.
Synopsys, the world’s leading provider of electronic design automation (EDA) software, has taken note of this trend and now generates approximately 45% of its revenue from “systems” companies rather than pure chip developers as it has traditionally done. . As electronic systems become increasingly sophisticated, Synopsys expects EDA tools to become increasingly important.
Finally listed
Top Japanese memory chip maker Kioxia, a leading provider of NAND flash memory, went public on the Tokyo Stock Exchange on Wednesday, with its stock ending the day up 16.9%. Mitsuru Obe of Nikkei Asia wrote that this IPO is a milestone for the company, which spun off from Toshiba in 2018, as it aims to accelerate technological development and capture growth in the AI era.
The IPO comes as Japan aims to revive its semiconductor industry and boost domestic production of vital chips. NAND flash memory, a type of data storage component, is required in all electronic devices. However, the market remains soft due to global economic factors and competition from major players such as Samsung, SK Hynix, and Micron as well as Chinese startups. Against this backdrop, Kioxia’s market capitalization of approximately 863 billion yen ($5.6 billion) at the end of the first day of trading is significantly higher than the valuation of 2 trillion yen when it was acquired by a Bain Capital-led consortium as Toshiba Memory in 2018. It was below.
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