In the middle of last January we tell you that during 2024 the semiconductor industry of China has produced 12.5% more than in 2023. Not bad at all, especially if we are in mind that US sanctions And his allies prevent Chinese integrated circuit manufacturers access lithography equipment for extreme ultraviolet (UVE) produced by the Dutch company ASML. And since the beginning of 2024 they cannot buy more machines from deep ultraviolet lithography (UVP).
At the current situation it is reasonable that we ask ourselves what kind are the integrated circuits that Chinese manufacturers are massively producing. And the answer is very revealing: these are chips derived from mature integration technologiesusually 28 nm or less advanced. After all, the semiconductors that we find mostly on electronic devices, appliances or cars, among other products, have been produced using them.
The sanctions hinder the production of avant -garde chips to SMIC
A good part of Chinese chip manufacturers, such as Hua Hong Semiconductor, China Resources Microelectronics or Guangzhou Zensemi, is manufacturing integrated circuits of 28 Nm or with even more mature technologies. And the company Beijing Yandong Microelectronics (YDME) will build A plant of 4.6 billion dollars expressly to produce 28 Nm semiconductors in 300 mm wafers. It is evident that these companies would not turn in this way in the manufacture of mature chips if it was not a profitable strategy, and, above all, necessary to support the Chinese industry of the integrated circuits at such a critical moment as the current one.
SMIC has the ability to manufacture integrated 7 nm circuits. And probably also 5 nm
However, the business of SMIC (Semiconductor manufacturing international corp), which is the largest Chinese manufacturer of semiconductors with a fee in the world market of about 5%it goes for other paths. This company currently has the ability to manufacture Integrated 7 Nm circuits. And probably also 5 nm. We know it with total certainty because this company manufactures, for example, the soc Kirin 9000s integrated into the smartphone Mate 60 Pro of Huawei, which has been scrupulously analyzed by several laboratories aligned with the US, such as the Canadian Techinsights.
Unlike most of Chinese integrated circuit manufacturers, SMIC does not live from mature chips. Your business revolves around the avant -garde semiconductors. To manufacture the 7 NM circuits that is delivering to Huawei and other customers using the UVP lithography equipment that has in its possession has been forced to resort to a technique known as Multiple patterning. And this strategy has two problems: it has an upward impact on the cost of chips and the decrease in production capacity.
In addition, it is important that we do not overlook that the sanctions deployed by the US and the Netherlands prevent SMIC from buying more UVP teams from ASML. And it also does not have access to some maintenance and support services. These circumstances have caused their performance and competitiveness for 2024 They have deterioratedand as a consequence Its benefits have fallen 45%: Of the 902.5 million dollars that reached in 2023 to 492.7 million in 2024. There is no doubt that it is a hard blow for a company with the size that SMIC has, so it will be interesting to verify how it reacts for 2025 To improve your competitiveness.
More information | SCMP