Key Sources:
Science and Technology Daily, "Jingyuan Electric Wholly Withdraws from the Equity of its Suzhou Subsidiary and Withdraws Profits by 1.5 Yuan Each in the Next Year" 2024.4.26
Preface
Science and Technology News on April 26, the world's largest chip testing factory Jingyuan Electronics announced that it was affected by geopolitical risks such as the US-China science and technology war and withdrew from the semiconductor manufacturing business in Chinese mainland.
It can be seen that the scientific and technological war launched by the United States against China has achieved results again, and domestic chips have been hit again!
So, how to break through domestic chips?
The world's largest chip test plant
Jingyuan Electronics Co., Ltd. was established in May 1987, the head office is located in Hsinchu City, Taiwan Province, next to the five interchanges, and the production town is located in Miaoli County, Taiwan.
After decades of development, Jingyuan Electronics Group's semiconductor product packaging and testing business ranks second in the world in terms of revenue, and also has the world's largest testing plant.
The Taiwan plant alone covers an area of 88,500 square meters, with a floor area of approximately 434,000 square meters and a clean room area of 207,000 square meters.
Not only that, Jingyuan Electronics has also made a strong investment in Suzhou, and owns all the shares of Jinglong Technology, which is mainly engaged in semiconductor packaging and testing business, which is the production and sales base in China and serves the mainland market nearby.
In addition, Kyungwon Electronics has a global presence and has offices in North America, Japan, and Singapore to provide global customer service.
In addition, Jingyuan Electronics' equipment and technology are extremely strong, so it has a high degree of control over the quality of chips, involving a number of key chip fields, especially in consumer electronics, with powerful testing equipment.
These devices can provide cutting-edge testing services not only for chip memory, system chips, logic and mixed signals, but also for mobile phone CMOS (image sensors), display drivers, and RF wireless devices.
It plays a key role in the back-end testing technology of global semiconductor products, and Jingyuan Electronics has the largest number of test equipment in the world, with a total of more than 4,800 test equipment, so it is also the world's largest chip test factory.
The world's well-known chip companies, including TSMC, Intel, Qualcomm, and MediaTek, all need Jingyuan Electronics to provide testing and packaging services for the back-end of chips, which plays an important role in the back-end of the chip industry.
Moreover, chip packaging and testing, as the core step through semiconductor design, production and packaging and testing, is the gatekeeper of chip quality, and because the semiconductor manufacturing process is becoming more and more complex, the semiconductor testing equipment is getting higher and higher, so semiconductor packaging and testing is very important in the semiconductor industry chain.
Therefore, from the service objects of Jingyuan Electronics, it can be seen that Jingyuan Electronics' packaging and testing services are very powerful, and the world's well-known chip design and chip manufacturing production have in-depth cooperation with Jingyuan Electronics.
As a global chip giant, Jingyuan Electronics' withdrawal from China's semiconductors will have what impact on the mainland chip industry chain?
Information sources:
Jingyuan Electronics "Company Profile-Global Locations-Factory Locations"
Jingyuan Electronics "Company Profile-Global Locations-Factory Locations"
Exit the Chinese market
As an important part of China's chip industry chain, the announcement of its withdrawal from China's semiconductor manufacturing business will definitely have an impact on the mainland semiconductor industry chain.
After all, Jingyuan Electronics' equipment and technology are relatively advanced, and the test bench designed and manufactured by Jingyuan Electronics is one of the most cost-effective test platforms and solutions on the market.
It can provide unique testing services for global semiconductors, which can greatly reduce the overall testing expenditure of customers, and the testing efficiency is very high, which can help customers quickly complete the market.
In addition, Jingyuan Electronics' completely self-developed test platform has been fully integrated in terms of test performance, mechanism interface, and system program, which not only leads the world in technology, but also realizes the development and innovation of software and hardware combination.
Therefore, companies like Qualcomm, MediaTek, TSMC, and Intel have become long-term partners of Jingyuan Electronics, which can be strong in the field of chip packaging and testing.
However, according to Zhao Jingyao, deputy general manager and chief financial officer of Jingyuan Electric, announced at the major information briefing that due to the impact of geopolitical risks such as Sino-US technology, Jingyuan announced the sale of 92% of the equity of its subsidiary Suzhou Jinglong Technology, and the handover will be completed by the end of the third quarter of this year.
At this point, the world's largest semiconductor packaging and testing plant has completely withdrawn from the Chinese mainland market, and 90% of Jinglong Technology's revenue comes from the Chinese market, announcing that there is one less strong enterprise in the mainland chip industry.
Therefore, it will definitely cause challenges in the field of chip packaging and testing technology in the short term, because both chip wafer testing and chip finished product testing require advanced equipment support.
If there is no advanced test equipment and perfect test process, it will cause a significant increase in the cost of chips, that is, the "ten times the cost" of chips, which must be avoided.
The "10x cost" means that if the chip failure is not found in the test process, then the cost caused by the failure at the subsequent board level will be more than 10 times.
Therefore, it may not cost much to manufacture a chip, but because there are many problems encountered in the test environment, resulting in a decrease in the yield rate of the chip, then the cost of a chip may be 100 yuan, but because there are many chip test failures, many chips cannot be used normally.
However, because the cost of chip manufacturing and chip testing have been spent, but the chip has not passed the test in the later stage, then not only the chip manufacturing cost is lost, but the previous test cost will also increase, which eventually leads to a 100 yuan chip requiring a cost of 200 yuan, which is difficult for customers to bear.
Therefore, as the world's largest professional testing factory, and also has advanced self-developed testing equipment and testing processes, the cost of manufacturing the mainland chip industry will increase if it withdraws from the Chinese market.
The reason for all this is because of the scientific and technological war launched by the US government against China!
Why is the U.S. government targeting China everywhere and sparing no effort to launch a technological war against China?
Information sources:
Science and Technology Daily, "Jingyuan Electric Wholly Withdraws from the Equity of its Suzhou Subsidiary and Withdraws Profits by 1.5 Yuan Each in the Next Year" 2024.4.26
Science and Technology Daily, "Jingyuan Electric Wholly Withdraws from the Equity of its Suzhou Subsidiary and Withdraws Profits by 1.5 Yuan Each in the Next Year" 2024.4.26
The United States is waging a technological war against China
This is because the U.S. government is too afraid of China, afraid that China will completely suppress the United States in terms of scientific and technological strength, and even more afraid of the collapse of its own "dollar hegemony" system.
Although on October 7, 2022, the U.S. government updated the "Export Control Regulations" for China, and also included 31 mainland companies in the "Entity List", and upgraded the control of semiconductors against China.
However, the U.S. blockade of mainland companies has long begun, and in 2018, the U.S. government launched an investigation into mainland technology companies without any licenses.
Especially for Huawei, because of the pressure of the U.S. government, the U.S. lost the mobile phone order with AT&T, the U.S. partner, in January 2018.
Later, on June 7, 2018, the U.S. Congress demanded that Google stop cooperating with Huawei, and also asked the Ollie government to prohibit Huawei from participating in the construction of Australia's 5G network and instead use their outdated 5G equipment.
And the sanctions against Huawei are also increasing, not only requiring Huawei not to use any American technology and parts, but also illegally detaining Huawei executive Meng Wanzhou (who has now returned to China).
In addition, it also demanded that American universities stop scientific research cooperation with Huawei, and implemented an embargo on Huawei, that is, not only did Huawei not use things, but even did not allow them to be transported, which is like a bandit.
It can be seen that the United States is not only at the national level in its scientific and technological war against China, but also has great restrictions on private enterprises in the mainland.
And in 2022, the U.S. government also passed a policy of the "CHIPS and Science Act", the core purpose of this strategy is to limit China's development in the chip industry.
Through this policy, the United States subsidizes chip companies, thereby attracting the global chip industry to move to the United States, and requires that after accepting the American subsidy, it cannot invest in the chip industry in China.
This so-called "CHIPS and Science Act" has seriously damaged the international trade order and hindered the recovery and development of the global economy.
At the bilateral level, it has also built strategic fulcrum countries for industrial and scientific and technological cooperation such as the United Kingdom, Japan, South Korea, Australia, and India, in an attempt to form a "coordinated operation" posture of economic competition with China in the world.
As a superpower, the United States consumes a quarter of the world's resources with only 300 million people, which is the purpose of the United States to maintain "dollar hegemony".
Through the "hegemony of the dollar", we should control as many high-tech industries as possible, master finance and oil, and vigorously develop science and technology and the military, so as to use our "deterrent position" to make people all over the world "work" for the United States!
So, with so many restrictions in the United States, how should domestic chips develop?
Information sources:
Global Network "In-depth Interpretation: What Does the U.S. "Chips Act" Mean for China's Chip Industry?", 2022.8.10
Global Network "In-depth Interpretation: What Does the U.S. "Chips Act" Mean for China's Chip Industry?", 2022.8.10
Where should domestic chips go?
Whoever goes abroad will be replaced!
Although the United States has made huge restrictions on Chinese chips, the only way the mainland can take at present is independent research and development, and technology is the core of great power competition.
Although the U.S. has indeed had a huge impact on China's chip industry chain in the early days, it can't resist the determination of these technology companies on the mainland.
And the data speaks for itself, according to the CCTV Chinese International Report, the output of "China Chip" in the first quarter increased by 40% year-on-year, which is the "achievement" of the United States under the suppression of China's science and technology!
China's science and technology industry has stepped up its efforts to innovate independently, accelerated the research and development of technology products, and found another way to achieve production, without using American equipment and American technology, as well as related technologies from its allies, and has achieved the localization of many technology industries.
Among them, the localization rate of degumming equipment in the semiconductor industry has reached more than 90%, and the representative manufacturer is Yitang Semiconductor.
The localization rate of semiconductor cleaning equipment is about 58%, and the representative manufacturers are Shengmei, North Huachuang and Zhichun Technology.
Shanghai Jingce and Wuhan Jingce are also professional chip testing factories in China, and they also have complete processes and technologies for professional chip testing.
In addition to these, with the release of the Kirin 9000S and Kirin 9010 chips in China, it is also officially announced that Mainland has also made a huge breakthrough in the high-end chip industry, and Continent is absolutely world-class in chip design capabilities.
Therefore, the road of domestic chips is not difficult to walk, but it is not easy to walk, but the mainland chip industry has increased dramatically from the early stage of the Sino-US science and technology war to today's chip production capacity.
Although there is still a gap between China's chips and the international level, the gap is not large, and the more the United States suppresses it, the more complete the mainland's chip industry chain will be, and the localization rate will be higher and higher.
It is not difficult to go from 1 to 100, but it is difficult to go from 0 to 1, and it is clear that the chip industry in the mainland has crossed 1 and has the ability to manufacture high-end chips.
Therefore, although the domestic chip is full of twists and turns, it will definitely succeed!
Information sources:
Guangming.com, "China Makes Efforts!The United States Miscalculates", 2024.4.25
Guangming.com, "China Makes Efforts!The United States Miscalculates", 2024.4.25
epilogue
The choice to withdraw from the Chinese market because of the Sino-US science and technology war is regrettable, but Jingyuan Electronics also made a choice full of consideration for the development of its own enterprises.
Although the United States has created some impact on China's science and technology war, judging from the information disclosed this year, China's chip industry is still developing rapidly.
Resources:
Science and Technology Daily, "Jingyuan Electric Wholly Withdraws from the Equity of its Suzhou Subsidiary and Withdraws Profits by 1.5 Yuan Each in the Next Year" 2024.4.26
Guangming.com, "China Makes Efforts!The United States Miscalculates", 2024.4.25
Global Network "In-depth Interpretation: What Does the U.S. "Chips Act" Mean for China's Chip Industry?", 2022.8.10
Jingyuan Electronics "Company Profile-Global Locations-Factory Locations"
Jingyuan Electronics "Company Profile-Global Locations-Factory Locations"
Science and Technology Daily, "Jingyuan Electric Wholly Withdraws from the Equity of its Suzhou Subsidiary and Withdraws Profits by 1.5 Yuan Each in the Next Year" 2024.4.26
Guangming.com, "China Makes Efforts!The United States Miscalculates", 2024.4.25
Global Network "In-depth Interpretation: What Does the U.S. "Chips Act" Mean for China's Chip Industry?", 2022.8.10