China buys more than half of the semiconductors manufactured in the world and yet only produces less the 10% of their own demand. Recently there have been a lot of announcements out of China about large scale investments in semiconductor manufacturing. The Chinese government for example has announced plans to invest $161 billion dollars over ten years in semiconductor manufacturing.
In terms of specific announcements Tsinghua Unigroup has the most ambitious plans. Tsinghua Unigroup has announced plans to invest $28 billion dollars in a 500,000 wafer per month foundry fab, $24 billion dollars for a 300,000 wafer per month 3D NAND Fab for their XMC subsidiary and also has plans for a $30 billion dollar investment in a 300,000 wafers per month memory fab. GLOBALFOUNDRIES has partnered with the Government of Chengdu on a $10 billion dollar foundry fab we project will produce >60,000 wafer per month including GLOBALFOUNDRIES 22FDX FDSOI process. There are several other projects underway or planned as well.
IC Knowledge LLC produces a database of all the current and planned 300mm fabs worldwide. We believe this is the most detailed and comprehensive 300mm database available. We are currently tracking 164 fabs and part of our analysis includes capacity by country.
As of the end of 2016 the top five countries in the world in terms of 300mm capacity in order from greatest to least capacity are:
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Based on current announcements and our projections we expect that China will pass the United States for the fourth most installed capacity by the end of 2018. The end of 2018 capacity by country would then become:
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Further projecting forward to 2020 we are forecasting China may pass Japan for third place and the rankings to be:
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As surprising as these results may be, by the end of 2023 are forecasting that China may pass Taiwan for second place and the ranking to be:
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And finally, in 2024 we are forecasting China may become the world leader in installed 300mm capacity and the ranking to be:
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Figure 1 summarizes the percentage of worldwide capacity each country represents by year.
This analysis comes with several cautions:
- This is 300mm capacity only and does not include older legacy 200mm and smaller wafer sizes. However, as 300mm is the most advanced and productive wafer size we believe this is a good metric for determining manufacturing leadership.
- This analysis is based on current and announced fabs. Other countries could install more capacity than we are currently forecasting, and, or china could install less capacity than they are currently planning. The recent announcements from China are both larger and more forward looking than most 300mm announcements. Certainly, China has been working to climb the ranks of the semiconductor industry for a long time with only moderate success to-date so not all of these announcements may actually take place.
- Currently the 300mm fabs in China lag the leading edge. The leading foundries worldwide are ramping 10nm processes and preparing 7nm for the next 12 to 24 months at a time when China’s most advanced foundry fabs don’t yet have 14nm in production. The XMC 3D NAND Fab will bring up a 32-layer process at a time that other 3D NAND producers will be on 64 layers and working on 96 layers.
Despite these cautions, the potential for China to have the largest installed 300mm capacity base by the mid twenty twenties should serve as a warning to the rest of the semiconductor industry of how aggressive China’s plans for semiconductor manufacturing expansion are.
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