Chinese wafer foundries lower prices to attract customers

Infineon / Mitsubishi / Fuji / Semikron / Eupec / IXYS

Chinese wafer foundries lower prices to attract customers

Posted Date: 2024-01-27

Recently, wafer foundries in mainland China have adopted a strategy of reducing tapeout prices in order to attract more customers. The implementation of this strategy may cause some customers to consider canceling orders and considering switching to wafer foundries in mainland China.

In order to ensure that the production capacity of wafer foundries is fully utilized, foundries in mainland China have to lower prices to retain existing customers and attract Taiwanese IC design companies. The information about the manufacturers in the market rumors has not yet been clear, but Chai Huanxin, a special consultant of the Optoelectronic Technology Industry Association (PIDA), said that this situation is unlikely to have much impact on Taiwan's position in the wafer foundry field.

Taiwan's major foundries, such as TSMC and UMC, remain stable in terms of mature processes and quotations for 8-inch wafers. But companies such as Power Semiconductor and World Advanced Micro Devices may be directly affected. Although mainland China is actively expanding its wafer production capacity, because Taiwan's wafer foundries mainly focus on logic process products, which are different from the product lines of mainland foundries, there is relatively little competitive pressure.

Market research company TrendForce pointed out in a recent report that the capacity utilization rate of semiconductor foundries will still face downward pressure in the first quarter of 2024. Although the outlook for end customer orders is unclear, TrendForce predicts that foundry inventory levels will improve in the second quarter of 2024 and return to a healthier balance.

Review Editor: Huang Fei

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