Zinger Key Points
- Chinese semiconductor leaders at the Beijing Expo focused on overcoming U.S. restrictions and advancing local chip production capabilities.
- BASiC Semiconductor increased investment to mitigate supply chain risks amid U.S. sanctions, while Moore Threads emphasized collaboration.
On Monday, Chinese semiconductor leaders and investors convened in Beijing for the 21st China International Semiconductor Expo, focusing on strategies to navigate U.S. restrictions and bolster local chip production capabilities.
The event, which gathered over 500 companies across design, foundry, and packaging sectors, highlighted the impact of Taiwan Semiconductor Manufacturing Co TSM scaling back advanced foundry services for Chinese firms, alongside the geopolitical challenges posed by a second Donald Trump administration.
Despite these hurdles, experts at the expo emphasized China’s growth potential in advanced semiconductors and generative AI, citing its expansive market as a significant driver, SCMP reports.
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BASiC Semiconductor co-founder He Weiwei discussed the company’s increased investment of up to $4.1 million to mitigate supply chain risks. He highlighted how U.S. sanctions and technological decoupling have strained the industry, forcing startups like BASiC to localize manufacturing processes.
Similarly, Moore Threads Technology co-founder Dong Longfei stressed the collaborative efforts needed between government, industry, and academia to advance domestic GPU production through alternative methods like chiplets.
The expo also addressed China’s challenges in developing cutting-edge semiconductor technology. Experts noted that Chinese fabs must catch up to Taiwan Semiconductor in advanced nodes, a gap exacerbated by export restrictions.
However, domestic companies are exploring innovative solutions to overcome these barriers and sustain competitiveness.
During the event, executives also discussed international partnerships, with Liu Yuanchao of the China Semiconductor Industry Association emphasizing the potential for collaboration between China and South Korea.
He pointed out the complementary nature of the two countries’ semiconductor industries, which could drive mutual growth in the sector.
Amid growing semiconductor demand, Taiwan Semiconductor has seen rising sales from Shenzhen manufacturers producing smart hardware. However, the company’s recent move to limit services for Chinese clients using advanced nodes has amplified local firms’ challenges as they strive to innovate while adapting to geopolitical pressures.
In November, the Biden government imposed sanctions on Taiwan Semiconductor, prohibiting advanced AI chip sales to China. During his presidential campaign, Trump had attacked China, sharing his plans to slap tariffs on exports to the country.
Taiwan Semiconductor stock gained 87% year-to-date thanks to the artificial intelligence frenzy.
The contract chipmaker plans to build over ten new semiconductor facilities globally by 2025, ramping up advanced production capacity.
Projects include cutting-edge 2nm fabs in Taiwan and a second plant in Japan’s Kumamoto region, which is set for construction in 2025.
Taiwan Semiconductor is advancing facilities in Arizona and Dresden while developing advanced packaging technologies like CoWoS and SoIC.
Capital expenditures could hit a record $34-$38 billion in 2025, driven by surging demand for high-tech semiconductor manufacturing.
Taiwan Semiconductor bagged $6.6 billion in U.S. subsidies and proposed up to $5 billion in loans for A16 chip production in Arizona under the CHIPS Act.
Price Action: At the last check on Wednesday, TSM stock was lower by 0.05% at $189.57 premarket.
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