China will miss 2025 IC self-sufficiency goals
Although about nine months has passed since IC Insights first predicted China’s slow progress (see Chinese progress towards chip self-sufficiency will remain slow) that has also brought China one year closer to its 2025 ‘Made in China’ target date. China has said that by then it wants its chip manufacturing to be equivalent to 70 percent of the ICs its market requires.
Market analysis firm IC Insights predicts that despite strong growth, about 9.2 percent CAGR from 2020 to 2025, China-produced ICs will represent only 19.4 percent of its IC market in 2025.
IC Insights reckons China made about $19.3 billion worth of chips in 2019 against a domestic market of $131 billion, representing 14.7 percent. In 2020 the numbers were $22.7 billion compared to $143 billion, an increase to 15.9 percent.
China’s IC market versus IC production 2009 to 20025F Source: IC Insights.
But, of the $22.7 billion only about $8.3 billion was produced by China-headquartered companies, therefore accounting for only 5.9 percent of the country’s $143 billion IC market. The $8.3 billion breaks down as about $2.3 billion was from IDMs and $6.0 billion was from pure-play foundries such as SMIC.
TSMC, SK Hynix, Samsung, Intel, UMC, and other foreign companies that have IC wafer fabs located in China produced the rest.
Even if China-based IC manufacturing rises to $43.2 billion in 2025, as IC Insights forecasts, China-based IC production would still represent only 7.5 percent of the total forecasted 2025 worldwide IC market of $577.9 billion.
Among the latest IC producers being established in China are memory startups YMTC and CXMT but it will take several years and a great deal of investment and a long time for them to impact the situation.
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