Chinese semiconductor industry

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AssassinsMace

AssassinsMace

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Well if Taiwan and South Korea want to save their chip industries, halt production of their chips now. They're not selling them to China which follows US demands but then don't sell them to the US either nor build chip factories in the US. When China starts making the same level chips, the results are going to be the same for them. Their industries are going to be decimated. Holding out on the US will give the chance to have their say and not give the US unilateral power maybe even force the US to allow them to sell chips to China. What is the US going to do? It will only delay their domestic capabilities where China will still be on its way without any delay.
 
tphuang

tphuang

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horse said:
The solution is very simple for the likes of Samsung of Korea.

They should choose China. Full stop. That is their biggest market and the market with the most potential. Nothing in this world can offer that to them.
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No, they should not choose China. China's goal is same as America's goal. That is to crush everyone else. If China has the choice, do you think it will leave any crumbs for Korea? not a chance.

hvpc said:
this is the foundries ranking only. Per my response to @european_guy, we’d have a even smaller share of the IDM (memory and non-memory) space. cthat’s not how things work. under standard international accounting rules, all revenue is reported usually by the controlling company. After removing all the expenses, the net profit is than divvy‘ed up between the controlling party and subsidiaries. So, for example revenue reported by SMIC would represent $ sale from all their wholly owned and JV fabs.
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To the best of my knowledge SMEC is foundry also and their revenue has been increasingly very steadily. It was almost half of Huahong Grace's revenue (I know, that doesn't include HLMC) in the most recent quarter. My point is that China has many chip makers now that are expanding rapidly. Just looking at the top 3 foundries by revenue is not a great way to assess things.

hvpc said:
Fabs you listed play mostly in the IDM space and at the moment also represent a minor amount.
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And they will get a lot bigger. The Chinese power/industrial sector is going through a major ramp up in the next 2 to 3 years. Only a fraction of that will get captured by SMIC and Huahong numbers.

hvpc said:
the industry still expect recovery in 2023. The question is how fast and how big of a rebound we will see this year.
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the industry doesn't seem to realize that the real economic crash has yet to happen.

hvpc said:
Right. CXMT had trouble keeping up with the big boy even without the sanctions. We can blame it on it not being able to land EUV scanners. BUT, Micron was able to fab D1a without EUV, using exact systems CXMT has. This speaks to the difference in capability of the new kid on the block, CXMT, and seasoned veteran like MICRON that has a knack at squeezing every bit of capabilities out of a given equipment.

CXMT is one of the rumored fabs that had and is considering changing their business model. They may have to convert part of their capacity for foundry a la PSMC (foundry of logic and specialty memories), maybe even have to split up the current company/fabs to support the new model.

YMTC‘s expansion will be limited. Domestic equipments are not all adequate to support their original expansion.

But, if you/we really believe domestic equipments are as ready as we are hyping on SDF, then I guess there’s nothing for us to worry about on SDF. Unfortunately, we in the industry hear a different narrative from the fabs themselve. Well, we will see how things plays out this year. If domestic WFE suppliers could really quickly shape up to fill the gap then no problem, but if they can’t, then YMTC‘s future is also not very good. Not as good as the outlook prior to Oct 7th, but not as doom and gloom like that Bloomberg article someone shared earlier.
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Actually, would you specify where we said domestic equipments are all ready? In reality, we are all trying to figure out just how much each player has been affected. CXMT to me looks like the most affected by the sanctions. 4 separate YMTC products have been unveiled in the past month by YMTC itself and other companies like Xiaomi. At the very minimum, it would suggest they have stocked up enough machines to continue expansion a little bit and can maintain most of their existing production (or else why would Xiaomi and Gloway push out new products with YMTC SSDs). I would be surprised if YMTC itself doesn't suffer any kind of delays in its expansion plans. Beyond that, I would imagine that sourcing parts and finding replacement would get progressively more difficult over time.

On the bright side, that should motivate them to work harder with domestic players, even if they end up producing at 128 layers.
 
tphuang

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tonyget said:
That is way over optimistic. I don't think there will be a working prototype in 4/5 years，let alone comercialization
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There are way too many patents coming out to not think that they are making great progress. I think you are letting past failures affect your thinking here. Why things are different with EUV
1) SMEE is not leading the project. It likely will be Huawei or someone more competent than that.
2) Every local foundry is motivated to work with whoever ends up leading the project
3) they will have experience from getting this SSA-800 project into mass production that they can share around (SSA600 clearly provided them lessons on what not to do)
4) captive market. There is no ASML competition, so being commercially competitive is just being better than the latest available DUVi scanner. So even if it's worse than the earliest production ASML EUV, that would still be sufficient.
5) A lot more government support here.
 
PopularScience

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tphuang said:
There are way too many patents coming out to not think that they are making great progress. I think you are letting past failures affect your thinking here. Why things are different with EUV
1) SMEE is not leading the project. It likely will be Huawei or someone more competent than that.
2) Every local foundry is motivated to work with whoever ends up leading the project
3) they will have experience from getting this SSA-800 project into mass production that they can share around (SSA600 clearly provided them lessons on what not to do)
4) captive market. There is no ASML competition, so being commercially competitive is just being better than the latest available DUVi scanner. So even if it's worse than the earliest production ASML EUV, that would still be sufficient.
5) A lot more government support here.
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And some the technology can be shared between DUV and EUV, for example the double stage and laser interferometer.
 
FairAndUnbiased

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hvpc said:
The two list represent different things:
1. like you said, Trendforce is based on revenue / Knometa is physical wafer count
2. Trendforce list is only for foundries / Knometa list is for all sectors (foundries/IDM/memory)
3. Trendforce list is based on company’s HQ location / Knometa is based on fab location

Physical wafer output does not take into account the value of the wafer (e.g. not all wafers are the same; one 7nm wafer should be worth more than one 90nm wafer). So, I’m the industry, we do look at both numbers, but the revenue number reflects the overall value and hence better for us to extract business opportunities from OpEx spending, and is a better tarting point for projecting future business opportunities from the top-down.

Chinese foundries accounting for 10% WW market share at the moment. But the WW share of DRAM, 3D-NAND, and IDM would be a lot less.

There was an ICInsight analysis that showed revenue share of all fabs in China to be ~16%, but once removing Samsung/SK Hynix/Soidgm/tsmc/UMC then that figure drops to single digit, I think it was ~6%.

Anthis, there are many different ways to analyze data or to report data that fits our narrative. Looking at the Knometa list would make us feel we are closer to the MIC2025 target. But, a revenue ranking has been the more standard way to look at this thing. The motivation for MIC2025 is not because we import lots of chip, it’s because we spend more money importing semiconductor than oil. Motivation is to cut down on $$ semi import so we can boost the GDP. It’s all about the $$, number of wafer output is just a mean to get there.
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physical wafer output has 1 thing that is important - as an indicator of how it affects other segments of the economy. for example, vehicles, industrial equipment, and appliances all use mature node chips and all of these segments are big drivers of Chinese economy, bigger than semiconductors themselves. Remember how Ford, Toyota, etc. had to stop production last year due to not having enough $1 MCU chips? Using domestic chips for industrial purposes captures more value in the domestic economy, ensures supply continuity, and establishes a feedback system between chip programmers, designers and fabs.
 
FairAndUnbiased

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tphuang said:
There are way too many patents coming out to not think that they are making great progress. I think you are letting past failures affect your thinking here. Why things are different with EUV
1) SMEE is not leading the project. It likely will be Huawei or someone more competent than that.
2) Every local foundry is motivated to work with whoever ends up leading the project
3) they will have experience from getting this SSA-800 project into mass production that they can share around (SSA600 clearly provided them lessons on what not to do)
4) captive market. There is no ASML competition, so being commercially competitive is just being better than the latest available DUVi scanner. So even if it's worse than the earliest production ASML EUV, that would still be sufficient.
5) A lot more government support here.
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Huawei has little experience in lithography. they are not starting at 0, since they have expertise in optics through their optical communications business, but how much of that translates into lithography which is about imaging optics? Nikon headed into lithography from photography, both of which rely on imaging optics, so it was easier for them.
 
PopularScience

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FairAndUnbiased said:
Huawei has little experience in lithography. they are not starting at 0, since they have expertise in optics through their optical communications business, but how much of that translates into lithography which is about imaging optics? Nikon headed into lithography from photography, both of which rely on imaging optics, so it was easier for them.
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Huawei actively recruited engineers/scientists with lithography experience last few years. Definitely not starting at 0.
 
H

hvpc

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FairAndUnbiased said:
physical wafer output has 1 thing that is important - as an indicator of how it affects other segments of the economy. for example, vehicles, industrial equipment, and appliances all use mature node chips and all of these segments are big drivers of Chinese economy, bigger than semiconductors themselves. Remember how Ford, Toyota, etc. had to stop production last year due to not having enough $1 MCU chips? Using domestic chips for industrial purposes captures more value in the domestic economy, ensures supply continuity, and establishes a feedback system between chip programmers, designers and fabs.
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Indeed. Physical wafer capacity data is useful for other analysis.
 
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