China's integrated circuit production is increasing 40% year-on-year to 98.1 billion units, and it is becoming a legacy chip production powerhouse due to US sanctions
It has been found that total production of integrated circuits (ICs) in China in the first quarter of 2024 will be 98.1 billion units, up 40% from the same period last year. Recently, the United States has strengthened its restrictions on semiconductor exports to China, but experts point out that 'legacy chips' developed using older generation processes are not subject to the restrictions, and that not targeting them has backfired.
China's semiconductor output jumps 40% in first quarter amid growing dominance in legacy chips | South China Morning Post
US sanctions transform China into legacy chip production juggernaut — production jumped 40% in Q1 2024 | Tom's Hardware
According to data released by the National Bureau of Statistics of China, total production in the first quarter of 2024 was 98.1 billion units, with March alone reaching a high level of 36.2 billion units, up 28.4% from the same month last year, setting a new record high.
China's IC production is growing rapidly due to increased production of EVs and smartphones, and manufacturing facilities are also expanding.
Semiconductors used in high-performance smartphones are generally developed using high-precision processes, but since these technologies are mainly dominated by the United States, China has been hit hard by export restrictions from the United States.
On the other hand, legacy chips used in automobiles, refrigerators, etc. were not subject to the restrictions. According to the Center for Strategic and International Studies, a Washington-based think tank, China has focused on investing in legacy chips due to the restrictions on cutting-edge semiconductors, and has been successful. It points out that this investment may have boosted overall semiconductor production.
According to TrendForce, a Taiwan-based IC research company, China's share of legacy chips in the global market will be 31% in 2023, but could reach 39% by 2027. Given this situation, some experts have pointed out that 'the U.S.'s restrictions on cutting-edge semiconductor exports have backfired by increasing the production of legacy chips.'
Furthermore, China is showing signs of becoming self-sufficient when it comes to cutting-edge semiconductors.
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