Semiconductor Week Review (December 15-21):
In a transformative week for the semiconductor industry, the Biden administration tightened controls over China’s access to AI chips while also launching a trade investigation into mature node semiconductors. As TSMC and Samsung race towards 2nm production, the space has seen major changes due to Intel’s leadership vacuum following the departure of CEO Pat Gelsinger. Meanwhile, Japan’s Lapidus faces a USD 32 billion challenge in its 2nm venture, while India’s chip sector is expanding through strategic partnerships.
US plans to launch trade probe into Chinese chips amid concerns over maturing nodes
Amid growing concerns about China’s market power and pricing strategy, the U.S. prepares to launch a Section 301 investigation into Chinese semiconductors, particularly mature process chips used in medical devices, cars, and smartphones. is in progress.
The study is expected to take at least six months to complete, but U.S. officials say China could supply up to 50% of the world’s new production capacity for mature process chips over the next three to five years. This comes amid expectations that chip prices in China will remain between 30% and 50%. % is below the US level.
The investigation, led by the Office of the U.S. Trade Representative, could lead to tariffs and other trade restrictions, but the agency will not allow imports of semiconductors because many are imported as components of finished products rather than as individual chips. facing the challenge of targeting.
Indian chipmaker secures power semiconductor deal, expands partnership
Kaynes Semiconductor, a subsidiary of Kaynes Electronics, has embarked on a significant expansion of its semiconductor capabilities through several strategic partnerships. The company secured major customers for its IGBT and IPM products in the power electronics sector, starting with a proof-of-concept stage before expanding to volume production.
In parallel, Keynes has formed alliances with key industry players. This includes a partnership with Mitsui & Co. for raw material sourcing, a partnership with Siemens for advanced design tools, and ongoing discussions with global memory chip vendors for packaging services.
The company also continues to grow in India through partnerships with startups like Light Speed Photonics and workforce development initiatives with Perceptive Solutions, including training programs and academic partnerships to build a skilled talent pipeline for the growing industry. is strengthening its position in the semiconductor ecosystem.
Biden cracks down on access to China’s AI chips through third countries
The Biden administration is preparing to announce new regulations targeting China’s acquisition of advanced AI chips through third countries, with a particular focus on Southeast Asian transit points such as Singapore and Malaysia. The measures, expected by the end of the year, will introduce a “country cap” system and tighten monitoring requirements to close existing loopholes in semiconductor export controls.
The move follows previous regulations announced by the Commerce Department on Dec. 2 that expanded restrictions on semiconductor manufacturing equipment and high-bandwidth memory chips. Although Nvidia has declined to comment on pending regulations, the company’s growing revenue from Singapore (which reached 22% in the latest quarter) highlights the region’s growing importance in global semiconductor trade and provides new This emphasizes the urgency of strict regulations.
China’s chip industry braces for recession in 2025 as oversupply looms
China’s semiconductor sector is heading for a major market correction in 2025, with major international equipment suppliers such as ASML and KLA seeing their revenues in China drop significantly due to growing oversupply concerns and tightening US sanctions. It is predicted that this will decrease. China currently operates 40 12-inch wafer fabs with a monthly production capacity of 1.55 million wafers, and plans to add 30 more production lines, but industry analysts say persistent oversupply has caused production capacity to decline. It warns that growth in demand and demand for equipment are likely to slow.
Chinese factories that had stockpiled equipment to counter U.S. regulations are now facing maintenance and parts supply challenges, with international providers like KLA anticipating up to a 30% drop in service revenue. This change is particularly important because While companies in Japan and the Netherlands maintain certain exemptions and used equipment providers have emerged as an alternative, industry consolidation has left China’s semiconductor ecosystem open to new companies while seeking local solutions for critical components. Forced to adapt to supply chain dynamics.
Intel CEO’s sudden resignation exacerbates company’s structural issues
Following the retirement of CEO Pat Gelsinger on December 1, 2024, Intel’s sudden leadership vacuum will be replaced by interim co-CEO David, as the board searches for a permanent successor. Zinsner and Michelle Johnston Holhouse’s intervention is exacerbating the chipmaker’s existing woes. The exit, widely seen as involuntary, comes amid a difficult transition for Intel to separate its design and foundry businesses while facing fierce competition from rivals AMD, Nvidia and Qualcomm. It was held on.
The company’s instability has shocked Taiwan’s technology supply chain and disrupted long-established partnerships in the motherboard, PC, server and IoT fields, while benefiting rival TSMC and providing Intel’s external foundry services. Orders are also increasing as reliance on the industry increases.
With ongoing restructuring and headcount reductions, as well as unreliable product roadmaps and potential delays in key technology developments, the company is struggling to find a leader who can address these mounting challenges, while the company’s board strives to select leaders who can address these mounting challenges. It faces a critical juncture in maintaining its market position.
Japan’s Rapidus faces steep climb in 2nm chip production race
Japanese chip venture Rapidus faces three major hurdles in its ambitious pursuit of 2nm semiconductor production, chairman Tetsuro Higashi said in an interview with the Nikkei Shimbun. The company has overcome technological challenges in leapfrogging from Japan’s current 40nm manufacturing capacity to 2nm, established market differentiation through specialized chips for robotics and AI applications, and relies heavily on government support. Financial concerns must be addressed.
Azuma has expressed confidence in mass production through partnerships with IBM and equipment manufacturers, but the project will require an estimated investment of 5 trillion yen (approximately 32 billion US dollars). Rapidus, currently backed by 920 billion yen in government subsidies, aims to shift about half of its equipment costs to private funding, but industry insiders are questioning the effectiveness and sustainability of the government-backed semiconductor initiative. I’m still skeptical about it.
TSMC and Samsung gear up for 2nm chip battle as production approaches
TSMC and Samsung Electronics are intensifying competition in the 2nm chip manufacturing field, with both companies aiming for mass production in 2025. While TSMC maintains a slight advantage in development and has secured premium customers such as Apple, Samsung has started to take on more aggressive challenges by rebuilding its leadership. and securing initial customers. The South Korean giant has appointed two president-level executives to strengthen its foundry division, and has already partnered with Japanese AI startup PFN on a 2nm AI accelerator.
TSMC plans to start prototyping in April 2025, and wafer prices could reach $30,000, double the current 4nm and 5nm processes, while Samsung plans to start full-scale production by Q4 2025. The aim is to establish a production system that The increased competition comes amid unexpectedly strong demand for 2nm technology. , which encouraged the expansion of both companies’ production capacity and technological capabilities.
