China was accountable for primarily the entire whole pure-play foundry market enhance in 2018. In 2019, the U.S./China commerce struggle slowed China’s financial progress however its foundry marketshare nonetheless elevated by two proportion factors to 21%. Moreover, regardless of the Covid-19 shutdown of China’s economic system earlier this yr, China’s share of the pure-play foundry market is forecast to be 22% in 2020, 17 proportion factors higher than it registered in 2010 (Figure 1).
Japan is anticipated to stay the smallest marketplace for pure-play foundry gross sales with solely a 5% share this yr (up solely two factors from its share in 2010). With its foundry market forecast to be price about $3.6 billion in 2020, Japan’s share of pure-play foundry gross sales is anticipated to be about 10% the scale of the 2020 Americas pure-play foundry market ($35.1 billion).
IC Insights believes that the Japanese marketplace for pure-play foundry companies will enhance solely barely sooner or later. The fabless IC firm infrastructure in Japan is small and never anticipated to develop a lot over the subsequent 5 years. Therefore, nearly the entire progress in foundry demand in Japan is anticipated to return from a higher variety of Japanese IDMs (e.g., Renesas, Toshiba, Sony, and so on.), using IC foundry companies.
The rise of HiSilicon and different fabless IC firms in China has elevated the demand for foundry companies in that nation. Figure 2 exhibits IC Insights’ itemizing of the highest pure-play foundries’ gross sales in China in 2018-2020.
In whole, pure-play foundry gross sales in China elevated by 10% in 2019 to $11.eight billion, a lot better than the 1% decline within the whole pure-play foundry market final yr. Moreover, in 2020, pure-play foundry gross sales to China are forecast to leap by 26%, seven factors higher than the 19% enhance anticipated to be registered by the full pure-play foundry market this yr.
As proven, UMC confirmed the very best gross sales enhance into China final yr with a 19% soar. This enhance was pushed by the continued ramp up of its Fab 12X situated in Xiamen, China, which opened in late 2016. The fab at present has capability of 18.7K 300 mm wafers per thirty days. An enlargement to 25.0K wafers per thirty days is anticipated to be full in mid-2021.
Following a 59% soar in 2018, TSMC’s gross sales into China elevated by one other 17% in 2019 to $6.9 billion. As a consequence, the China market was accountable for primarily all of TSMC’s gross sales enhance final yr with China’s share of the corporate’s gross sales greater than doubling from 9% in 2016 to 20% in 2019. In 2020, China-based SMIC and Taiwan-based TSMC are forecast to register sturdy gross sales will increase in China of 32% and 30%, respectively. For SMIC, a 32% gross sales enhance into China this yr can be a giant turnaround from the 7% decline in China gross sales the corporate logged in 2019.
TSMC had sturdy gross sales into China within the second half of final yr that had been boosted by gross sales of 7nm utility processors to fabless IC provider HiSilicon. In the primary half of 2020, TSMC’s gross sales into China flattened at $2.2-$2.Three billion per quarter. Given that TSMC’s gadget shipments to HiSilicon resulted in mid-September, it stays to be seen if that income may be changed in 4Q20 with gross sales from different China-based firms.
