Chinese chip manufacturers could double capabilities within five to seven years

Chinese Semiconductor Manufacturers Aim to Double Production Capabilities

Chinese semiconductor producers aim to decrease reliance on imported equipment and materials and transition to more advanced technologies. Importantly, they are also planning to expand their production capabilities. According to Barclays’ analysts, these companies are predicted to be able to double their production capacities in China over the next five to seven years. Notably, 60% of this increase will happen within the next three years.

Underestimated Growth Potential

Representatives from Barclays forecasted this growth after studying data from 48 manufacturers which have chip production enterprises in mainland China, Bloomberg has reported. Barclays experts believe that major news sources undervalue not only the number of chip production enterprises in China but also their expansion potential.

Chinese Manufacturers Focusing on Mature Technologies

The majority of Chinese producers are expected to prioritize their growth by focusing on mature technologies, like the 28-nm process, which is more than a decade behind the current market-leading solutions. However, this technology is still popularly used for a wide range of semiconductor parts. Projections indicate that by 2026, provided production continues to expand at the current rate, there might be an excess of such ‘mature’ chips in the market. However, several external factors might prevent this scenario from actualizing.

Impact of U.S. Sanctions

U.S. sanctions and those from their allies, intended to curtail technological progress in China, will undoubtedly continue impacting Chinese manufacturers in the coming years.