Mainland China will need a large amount of mature process semiconductors above 28 nanometers in the automotive industry in 2023, and currently accounts for 29% of global production capacity.Due to the export control of advanced equipment by the United States and others, mainland China has turned to expand investment in mature processes (28nm and more mature processes). It is expected that the proportion of mature process production capacity in mainland China will reach 39% in 2027.
SMIC, Huahong Group, and Hefei Jinghe Integration are the most active in expanding production. The expansion will focus on special processes such as driver chips, CIS/ISP, and power semiconductor discrete devices.
Research shows that based on an analysis of 48 chip manufacturers with manufacturing plants in China, it is expected that 60% of new production capacity may be added within the next three years.
Chinese companies have accelerated the purchase of important chip manufacturing equipment to support capacity expansion and increase supply. Leading semiconductor equipment manufacturers including ASML of the Netherlands and Tokyo Electronics of Japan have received a large number of orders from China in 2023.
According to agency statistics, the production capacity of mainland China's semiconductor manufacturers will increase by 12% year-on-year in 2023, reaching 7.6 million wafers per month. Mainland China chip manufacturers are expected to start operating 18 projects in 2024, with production capacity increasing by 13% year-on-year in 2024, reaching 8.6 million wafers per month.
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