According to previous foreign media reports, as the U.S. government is considering sanctioning China’s largest domestic wafer foundry, SMIC, although the decision on whether SMIC is currently sanctioned is still inconclusive, it has caused ripples in the semiconductor industry. According to information obtained by Taiwan’s “Science and Technology News”, the top executives of Qualcomm, the world’s leading mobile processor, have come to Taiwan to visit major wafer foundries recently, so that if SMIC is sanctioned, Qualcomm’s orders can go smoothly. Go to Taiwan factory. It is understood that the manufacturers that Qualcomm locked in the meeting include TSMC, UMC, and the world’s advanced.
According to the news from the supply chain, in response to the possible further sanctions against SMIC by the US government, Qualcomm’s executives came to Taiwan to visit major wafer foundries recently. Its purpose is not only to consolidate the continuous supply of existing production capacity, but also hope that each foundry can further increase the production capacity to prepare for receiving relevant orders from Qualcomm to SMIC in the event of sanctions.
It is understood that after the news that SMIC may be sanctioned, SMIC’s customers have begun to seek other supplies, and in the event of sanctions, relevant orders can be delivered smoothly. According to SMIC’s annual report, Qualcomm, which came out to find a home this time, accounted for about 13% of SMIC’s overall revenue. 28nm to 14nm process entry and cell phone mobile processors.
Since some of the power management ICs that Qualcomm handed over to SMIC will be provided to Apple for use, so in the current 8-inch factory production capacity is in short supply, in order to avoid future out of stock, the market also reported that even Apple has come forward News to help Qualcomm transfer production capacity. However, Qualcomm said it had no knowledge of this.
The 8-inch capacity shortage is even more severe, and UMC has increased the price of urgent orders by more than 20%
In addition, Broadcom, another major international customer of SMIC, also placed orders mainly for power management ICs. For the already tight 8-inch production capacity, once SMIC is sanctioned, the tight 8-inch situation will be even more severe. In addition to further raising the 8-inch foundry price, it will also increase profits. Lower driver IC products may also have an order crowding effect.
As for this wave of 8-inch foundry price hikes, it is understood that UMC has the most rapid growth. Some foreign investors have previously pointed out that UMC will increase the price of 8-inch foundries by 5-10% in the fourth quarter. At present, there is even news that UMC will increase urgent orders by 25%. This wave of tight 8-inch production capacity has also made relevant IC designers complain a lot. Some IC design companies privately said that they have been rushing for production capacity every day since the fourth quarter of 2019, which shows the popularity of 8-inch production capacity.
In addition to Qualcomm’s consolidation of production capacity, Chinese IC design factories are also actively looking for alternative production capacity
In addition to Qualcomm’s rumors, according to a report by Taiwanese media “Economic Daily”, in response to the U.S. government’s possible further sanctions against SMIC, the Chinese government requires wafer foundries in China to give priority to supplying IC designers in mainland China. production capacity, so as to reserve related product inventory in advance, and continue to reserve autonomy. In this regard, China’s IC design factories are also full of firepower.