Chinese semiconductor thread II

[LanceD23]

I think you have miss interpreted the news. The news says that SMIC lower the price by 1500 dollars, thats SMIC trying to attract customer by lowering the price. The news did not say that the COST lowered by 40%，it is price that SMIC quoting to customer lowered by 40%. SMIC could very well be selling 28nm at a loss or very thin margin，in order to gain market share

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Selling 28nm at a loss? Well, people already saying the advanced nodes of 7nm of SMIC is not high for huawei, then pretty much most of stuffs SMIC made are at loss? It doesn't make sense. I could think SMIC could compensate low yield 7nm by gaining more profits from mature 28nm.

THe key question why can't Taiwan companies do the same? Is it because their western tools , materials and maintenance cost more versus Chinese using domestic toolings and materials?

 

[tokenanalyst]

what's the domestic supplier for FIB (focus ion beam) and XRD (X ray diffraction)

View attachment 143919

View attachment 143920

Angstrom-e and Leuven Instruments.

 

[MortyandRick]

I think you have miss interpreted the news. The news says that SMIC lower the price by 1500 dollars, thats SMIC trying to attract customer by lowering the price. The news did not say that the COST lowered by 40%，it is price that SMIC quoting to customer lowered by 40%. SMIC could very well be selling 28nm at a loss or very thin margin，in order to gain market share

You literally win the reward for mental gymnastics to make it look like good news is bad for SMIC.

With the ban going on, they don't need to drop prices to gain market share as Chinese companies are more likely to use SMIC due to fear of sanctions. Sanctions keep moving to less and less advanced nodes. It's only a matter of time.

They must have had production costs to list the user cost by 40%! That's a huge decrease. So cope harder!

 

[Phead128]

I think you have miss interpreted the news. The news says that SMIC lower the price by 1500 dollars, thats SMIC trying to attract customer by lowering the price. The news did not say that the COST lowered by 40%，it is price that SMIC quoting to customer lowered by 40%. SMIC could very well be selling 28nm at a loss or very thin margin，in order to gain market share

SMIC has a captive market with low price elasticity and high demand for domestic options due to US sanctions. This free market high price elasticity has been tried before, didn't work until US sanctions pushed companies to consider domestic options. What likely has happened is that domestic substitution with competitive Chinese components has allowed greater margin and cost efficiencies.

 

[tinrobert]

SMIC has a captive market with low price elasticity and high demand for domestic options due to US sanctions. This free market high price elasticity has been tried before, didn't work until US sanctions pushed companies to consider domestic options. What likely has happened is that domestic substitution with competitive Chinese components has allowed greater margin and cost efficiencies.

This is what I said in my Substack article on this topic: Recent

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that China’s Semiconductor Manufacturing International Corp.’s (SMIC) aggressive pricing on 28nm chips is reshaping the competitive landscape overlook the broader realities of the semiconductor industry. SMIC’s decision to reduce the price of its 28nm wafers from $2,500 to $1,500 has been framed as a bold move to erode Taiwan Semiconductor Manufacturing Corp.’s (TSMC) (TSM) market share in the mature node segment. However, a deeper analysis reveals that TSMC’s leadership remains unshaken. With its superior technology, trusted customer relationships, and efficient operations, TSMC continues to dominate in a market that prioritizes reliability and performance over price alone. You can read it here -

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TSMC's Resilience in Mature Nodes: Debunking the SMIC Price War Narrative​

 

[LanceD23]

This is what I said in my Substack article on this topic: Recent

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that China’s Semiconductor Manufacturing International Corp.’s (SMIC) aggressive pricing on 28nm chips is reshaping the competitive landscape overlook the broader realities of the semiconductor industry. SMIC’s decision to reduce the price of its 28nm wafers from $2,500 to $1,500 has been framed as a bold move to erode Taiwan Semiconductor Manufacturing Corp.’s (TSMC) (TSM) market share in the mature node segment. However, a deeper analysis reveals that TSMC’s leadership remains unshaken. With its superior technology, trusted customer relationships, and efficient operations, TSMC continues to dominate in a market that prioritizes reliability and performance over price alone. You can read it here -

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TSMC's Resilience in Mature Nodes: Debunking the SMIC Price War Narrative​

But TSMC's decision of shrinking its mature sector from 50% of its current porfolio to 30% and increased its advanced node to 70%.
Many in taiwanese media have commented because of this TSMC have avoided damage of price war. And the ones suffered more are UMC, VIS and PSMC because they dont have advanced nodes to offset this.

 

[sunnymaxi]

This is what I said in my Substack article on this topic: Recent

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that China’s Semiconductor Manufacturing International Corp.’s (SMIC) aggressive pricing on 28nm chips is reshaping the competitive landscape overlook the broader realities of the semiconductor industry. SMIC’s decision to reduce the price of its 28nm wafers from $2,500 to $1,500 has been framed as a bold move to erode Taiwan Semiconductor Manufacturing Corp.’s (TSMC) (TSM) market share in the mature node segment. However, a deeper analysis reveals that TSMC’s leadership remains unshaken. With its superior technology, trusted customer relationships, and efficient operations, TSMC continues to dominate in a market that prioritizes reliability and performance over price alone. You can read it here -

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TSMC's Resilience in Mature Nodes: Debunking the SMIC Price War Narrative​

$1000 is a big difference even if you have to compromise in yields to some extent. but yeah TSMC has advantage in trusted customer relationships, and efficient operations but not in technology. SMIC and other Chinese players have massive 28nm capacity coming online. what if government forced local firms to use domestic mature semiconductors.. it will definitely dent TSMC revenue in mature nodes.

i just cannot buy this narrative ''TSMC's resilience in Mature Nodes'' this can be shaken.

 

[tokenanalyst]

This is what I said in my Substack article on this topic: Recent

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that China’s Semiconductor Manufacturing International Corp.’s (SMIC) aggressive pricing on 28nm chips is reshaping the competitive landscape overlook the broader realities of the semiconductor industry. SMIC’s decision to reduce the price of its 28nm wafers from $2,500 to $1,500 has been framed as a bold move to erode Taiwan Semiconductor Manufacturing Corp.’s (TSMC) (TSM) market share in the mature node segment. However, a deeper analysis reveals that TSMC’s leadership remains unshaken. With its superior technology, trusted customer relationships, and efficient operations, TSMC continues to dominate in a market that prioritizes reliability and performance over price alone. You can read it here -

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TSMC's Resilience in Mature Nodes: Debunking the SMIC Price War Narrative​

TSMC is definitely dominating in advanced nodes but a 1000 dollars reduction per wafer is just to big to ignore (IF True). It will definitely catch the attention of some automakers and consumer electronic manufacturers trying to cut costs.

 

[tphuang]

remember, not all 28nm process are equal. There are platforms or chip types that are harder than others. Even TSMC is still at 40nm for BCD. So, I think it's reasonable to assume that TSMC's 28nm ASP will remain higher than SMIC, but SMIC will also likely eat into TSMC market share in 28nm by offering volume at lower prices.

 

[interestedseal]

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Another startup company developing 3kw, 10kw and 20kw CO2 laser for lppeuv. This is just a private player from Tsinghua spin-off. The national teams should be much farther advanced