Information sources:
National Bureau of Statistics, "The Added Value of Industrial Enterprises above Designated Size Grew by 4.5% in March 2024" 2024.4.16
National Bureau of Statistics, "The National Economy Achieved a Good Start in the First Quarter", 2024.4.16
General Administration of Customs of the People's Republic of China, March 2024 National Import Key Commodities Volume and Value Table (RMB), April 12, 2024
Preface
According to the data released by the National Bureau of Statistics on April 16, the output of integrated circuits in mainland China soared by 40% year-on-year in the first quarter, reaching 98.1 billion pieces.
However, if you want to achieve self-sufficiency in chip production, you still need to vigorously develop lithography machines and other related equipment.
When will the breakthrough of domestic chips be completed?
Domestic chips exploded
With the rapid economic development of the mainland, domestic chips have also ushered in a big explosion.
According to the latest data from the National Bureau of Statistics, the production capacity of integrated circuits in mainland China soared by 40% year-on-year in the first quarter of 2024, with a total output of 98.1 billion pieces.
Among them, the output in March alone reached 36.2 billion pieces, accounting for nearly 37% of the total production capacity, setting a record high in a single month in history, and the mainland's chip production continues to increase every month.
This also represents the mainland's "high-end manufacturing industry is growing faster"!
You must know that chips are an indispensable part of modern human life, and basically any electronic product around you has integrated circuits, that is, chips.
Whether it is the mobile terminal products we use, mobile phones or watches or some smart wearable devices, they all need the blessing of chips to operate normally.
Because in the development of industrial manufacturing and integrated circuit chips, the mainland's manufacturing industry has increased by 5.1% year-on-year.
The growth in the manufacturing of computer communications and electronic equipment reached 10.6 percent, which can be said to be a very frightening growth!
Not only that, but the mainland is currently producing a certain amount of output in the export of domestic chips.
With the continuous improvement of the level of chip manufacturing in the mainland, SEMI statistics show that in the field of 28nm and above, China's semiconductor equipment manufacturers have achieved full coverage, and the localization rate has reached more than 80%.
It is precisely because of the continuous improvement of the localization rate of domestic chips and the development of the mainland in the industrial field that the mainland's gross domestic product (GDP) in the first quarter increased by 5.3% year-on-year.
This has a lot to do with the mainland's industrial manufacturing and chip development.
So why did chips on the mainland suddenly start to grow?
Why is there a sudden increase in domestic chips?
In fact, it is because the mainland is becoming more and more mature in the main links of integrated circuits.
Especially in terms of chip design, the chip design level of the mainland has also been greatly improved, which is evident in Huawei's mobile terminal equipment.
Moreover, there has been a certain breakthrough in chip manufacturing, and the chip manufacturing and processing in the mainland are currently in a state of steady rise.
It is also because of this that the maturity of the mainland in the integrated circuit industry has been continuously improved, and the domestic chip production capacity has ushered in a big explosion.
It is also with the continuous improvement of the current national economic level, and the demand for electronic products is also increasing.
Especially in the demand for smart TVs and smart air conditioners, people's lives are becoming more and more inseparable from chips.
Not only that, but as the mainland begins to pay attention to health, the demand for smart bracelets and medical devices is also increasing, so these devices can be used to monitor physical health, and the demand for chips will also be great.
The most important thing is that the current development momentum of new energy vehicles in the mainland is very good, and it is already the world's largest automobile exporter.
At present, the production of new energy vehicles in the first quarter of 2024 has reached 1.65 million units, of which 1.586 million units have been sold, an increase of 27.7% compared to the same period.
And a new energy electric vehicle on the chip can reach more than 2,000, if it is a new energy vehicle with high-end auxiliary navigation or other functions, then the required chip needs to reach more than 3,000.
Because there are more electronic devices and Internet of Things devices in new energy vehicles, the demand for chips will also be greater.
Moreover, the process requirements for chips in new energy vehicles will not be very high, and the current chip production level of the mainland can fully meet them.
Therefore, due to various factors, the mainland's chip manufacturing capacity in the first quarter has increased so much.
Even if the mainland's domestic chips have such a large production capacity, they still cannot be self-sufficient.
How many difficulties are there in the development of chips in the mainland?
Self-sufficiency is still difficult
Due to the "Chips Act" of the United States against the mainland and the blockade of high-end industries in the mainland.
The mainland's chip manufacturing technology is still facing huge challenges, and it is precisely because of the blockade of mainland science and technology by the United States that the mainland's current lithography machine production chip intelligence hovers at the terminal level.
Because high-end lithography machines are the crystallization of human technology, advanced technology and high-end materials need to be imported from many countries around the world to be manufactured.
You must know that before the United States had no blockade of China's technology sector, HiSilicon's chip design capabilities had reached the world-class level.
In 2020, it launched the world's first 5nm integrated 5G SOC, with up to 15.3 billion transistors on a small chip, which is also Continental's leading position in the field of chip design.
However, after the U.S. imposed a technology blockade on mainland technology and enterprises.
Mainland science and technology enterprises can't use anything, and lithography machines can only use relatively backward ones.
Although ASML, a well-known Dutch lithography machine manufacturer, was in a hurry to turn around because of the loss of the Chinese market, it also had to comply with the requirements of the United States.
Therefore, the main production process nodes in mainland China are mainly between 14nm and 90nm, so there are many limitations at the process level.
You must know that the most profitable chips are high-end chips, that is, chips used in high-end mobile phones.
For example, in the Qualcomm Snapdragon Gen series, most of the profits of mainland mobile phone manufacturers are basically earned by these chip companies in the United States, which is exactly what the United States wants.
However, although it is difficult to develop at present, compared with the advanced process of 5 nanometers or higher, 28 nanometer chips are actually still the mainstream.
At present, most of the chips needed in the world are made of more than 28 nanometers, and it is officially because of these reasons that the mainland's chip production capacity in the first quarter will usher in a big explosion.
However, compared with developed countries in the West, there is still huge room for development and improvement in chip manufacturing equipment and technology in the mainland.
Because in the market below 7 nanometers, domestic chips basically have no market share.
However, you must know that most of the profits are also on this kind of high-end chips, so domestic chips are self-sufficient in China, and they still need to get more development and more capital investment in lithography machine manufacturing equipment and machines.
Therefore, although the mainland's chips increased by 40% in the first quarter, the chips imported from abroad are actually very large.
According to data released by the General Administration of Customs of the mainland, the import volume of integrated circuits in the first quarter increased by 12.7% year-on-year to 121.5 billion.
Therefore, the road to self-sufficiency in the domestic chip industry still has a long way to go.
So, how can domestic chips break through the status quo?
How to break through the status quo
In the face of the scientific and technological blockade of the United States and other Western countries, the mainland has also been working chip technology
According to Xinhuanet, Robert Castellano, president of the "Information Network" company of the Microelectronics Industry Research Institute, wrote that the US sanctions, the entity list and the chip bill have not hindered China, but have strengthened China's determination to surpass the United States.
Robert Castella also stated:
"SMIC, China's leading chip company, already has the capacity to produce 7nm chips, and China's domestic equipment suppliers are manufacturing equipment to produce 5nm chips. ”
In other words, SMIC has achieved successful tape-out in the N+1 process, or in the case of EUV lithography machine, it has achieved 7nm chip manufacturing, which shows that it has definitely made a major breakthrough in technology.
Therefore, SMIC does not produce 7nm in the end, we can see by looking at the "entity list" of the United States.
And in 2023, the mainland Harbin Institute of Technology also announced a breakthrough in lithography technology.
At present, the 7nm 9000S made of Huawei's 7nm released last year, and the "Kirin 9010" just released for the Huawei Pure 70 series, seem to be the best illustrations.
This year, Huawei's announcement of "multiple exposure technology" in patents also proves that mainland China has been making breakthroughs in the field of lithography technology, and has also invested a lot of money and talents.
Therefore, if domestic chip manufacturing wants to make a breakthrough, then it is necessary to continue to overcome lithography machine technology, and it is also necessary to complete the industrial upgrading of chip manufacturing as soon as possible, and strive to achieve manufacturing made by domestic processes below 7 nanometers as soon as possible.
In addition to these, it is more important to make a breakthrough in the "self-developed instruction set", which Huawei is already doing, which is also very important.
Chip design is based on the "instruction set" for architecture, so chip companies need to obtain authorization and pay authorization fees to use the instruction set.
The well-known instruction set architecture, such as X86 and ARM, are all from abroad, so the self-developed instruction set is also very urgent.
Therefore, the mainland should not only increase investment in chip research and development, but also cultivate more talents in the semiconductor manufacturing industry, and also need to strengthen international cooperation, especially actively cooperate with international advanced chip companies.
And it is also necessary to promote market demand, promote mainland enterprises to accelerate the research and development of chip technology, or develop innovative products.
Come to an end
Therefore, the explosion of domestic chips in the first quarter of the mainland is also the result of the continuous breakthrough of the mainland's chip production capacity.
Despite external pressures and technological challenges, China's chip industry has shown strong vitality and potential in recent years, and the growth is not only a change in numbers, but also represents the increasing importance of the mainland's position in the global chip industry.
At present, the mainland's semiconductor facilities and technologies continue to make breakthroughs, and the output of domestic chips is becoming more and more mature.
As long as mainland science and technology enterprises are steady and steady, they will definitely be able to break through all kinds of problems in the face of high-end chips, and sooner or later one day we can also use domestic 3 nanometers, or even 1 nanometer chips.
Information sources:
National Bureau of Statistics, "The Added Value of Industrial Enterprises above Designated Size Grew by 4.5% in March 2024" 2024.4.16
National Bureau of Statistics, "The National Economy Achieved a Good Start in the First Quarter", 2024.4.16
General Administration of Customs of the People's Republic of China, March 2024 National Import Key Commodities Volume and Value Table (RMB), April 12, 2024