Wafer production capacity in mainland China is growing rapidly, and will be able to surpass Japan in one year and become one of the world's TOP 3?
Recently, IC Insights released a data map of chip production capacity in various countries and regions around the world at the end of 2020. The top five rankings are Taiwan, South Korea, Japan, Mainland China, North America, ROW (rest of the world).
The production capacity statistics standard is based on factory ownership. For example, Samsung's factories in the United States will be counted in the total production capacity of the United States, and TSMC's factories in mainland China will be counted in the total production capacity of the mainland.
Data show that as of the end of December 2020, the global monthly production capacity reached 20.814 million pieces. China's Taiwan region has the world's largest chip production capacity and is the base with the largest IC wafer capacity, with a monthly production capacity of approximately 4.448 million pieces, accounting for 21.4% of the global share. South Korea's monthly production capacity is second only to China's Taiwan region, accounting for 20.4% of the global share. Japan, ranked third, has a global share of 15.8%. China is second only to Japan, with a monthly production capacity of approximately 3.281 million pieces, ranking fourth with a share of 15.3%. North America and Europe rank fifth and sixth respectively, with a global share of 12.6% and 5.7% respectively.
Through the data, it can be found that the fourth-ranked mainland China and Japan have only a 0.5% difference in production capacity. Optimistically, this means that by increasing the production capacity by 0.5% to 1%, mainland China will be able to catch up with Japan and become one of the world's TOP3.
So, how long will China have to catch up to surpass Japan?
At present, domestic chips are good, and the semiconductor industry is in a climbing stage. China's chip production capacity sprints into the global TOP3 with the following favorable conditions:
One is that the production lines that were built before this year will be mass-produced in the next year or so. For example, the production capacity of the first phase of the Yangtze River Storage National Memory Base project is expected to exceed 100,000 pieces/month by the end of this year, and the production capacity of the second phase of the factory will increase by 50% by 2022. Silan Micro's 12-inch chip production line is expected to achieve a monthly production target of 30,000 chips in the fourth quarter of this year. Innosecco's 8-inch silicon-based gallium nitride is officially mass-produced, and the production capacity is expected to reach 6,000 pieces/month this year. In 2016, Sun Microelectronics Beijing launched the 8-inch MEMS international foundry line and officially launched mass production in June this year.
According to statistics, during 2020, more than 300 wafer production lines have been built globally, of which nearly half are in China, covering mainstream sizes such as 4 to 12 inches. From the perspective of the production progress of the company, many semiconductor companies will be able to achieve capacity growth in the fourth quarter of this year. Starting from 2022, mature process capacity will be launched one after another and will reach its peak in 2023.
Second, under the situation of insufficient global chip supply, local wafer manufacturers and international wafer manufacturers have started a wave of expansion in the mainland. The results of the expansion wave are very obvious. According to statistics, in June this year, my country’s total chip production reached 30.8 billion, an increase of 43.9% compared to the same period last year. The single-day chip production exceeded 1 billion, setting a new record. History.
The implementation of the expansion plan includes semiconductor companies such as SMIC, Yangtze River Storage, Hefei Changxin, Silan Micro, and China Resources Micro. For example, SMIC and the Shenzhen government have established a joint venture with a new 12-inch production line of 28nm and above, which is expected to start production in 2022 with a planned monthly production capacity of 40,000 pieces. China Resources Micro and the Big Fund jointly built a 12-inch power semiconductor wafer production line project, which is expected to form a monthly output of 30,000 wafers. TSMC, the leading wafer foundry company, announced an expansion of production in Nanjing this year. According to its previous plan, TSMC will expand its 28nm production capacity by approximately 40,000 wafers per month.
Judging from the production plans of major wafer manufacturers, the production lines to be built this year will also achieve mass production in the next two to three years.
There are many factors that determine whether China's production capacity can surpass the global TOP3, and increasing production capacity is just one of them. In the face of the global chip shortage, not only domestic manufacturers are actively expanding production, but foreign manufacturers such as Intel, Samsung, and SK Hynix have also increased their capital support plans to expand production.
However, in terms of capacity expansion, Japanese semiconductor companies such as Renesas Electronics, Fujitsu, and Panasonic have not moved as frequently as mainland Chinese companies. Renesas Electronics, which has been hit by natural disasters such as fires, has said that there is no need to increase production capacity and hopes to deal with the tight supply of chips through cooperation with suppliers.
IC Insights predicts that between 2021 and 2025, China's production capacity will increase by approximately 3.7%, making it the only region with an increase in production capacity. If this growth rate is maintained, China's wafer production capacity will grow rapidly, and it is expected to surpass Japan in the future.