Semiconductor Manufacturing International Corp. (SMIC), one of China's largest chipmakers, operates ... [+]
Mainland China will lead the world in equipment spending for industry mainstream 300mm semiconductor factories, with $30 billion in investments in each of the next four years, according to a forecast on Monday by U.S.-based industry group SEMI.
Spending by the country will be “fueled by government incentives and domestic self-sufficiency policies,” SEMI said. 300mm refers to the diameter of wafers used in making semiconductors; it’s equivalent to about 12 inches.
Taiwan is expected to rank second in equipment spending at $28 billion in 2027, an increase from $20.3 billion in 2024. South Korea is expected to rank third at $26.3 billion in 2027, up from $19.5 billion this year, SEMI said.
The increases are part of an expected rise to a record $137 billion in spending in 2027 after surpassing $100 billion for the first time by 2025 on new AI-related applications, the strength of the memory chip recovery, and strong demand for high-performance computing and automotive applications, SEMI said. Growing demand for AI-related chips have sent shares of suppliers and manufacturers such as Nvidia and Taiwan Semiconductor Manufacturing Co. soaring in the past year.
“Projections for the steepening ramp of 300mm fab equipment spending in the coming years reflects the production capacity needed to meet growing demand for electronics across a diverse range of markets as well as a new wave of applications spawned by artificial intelligence innovation,” said Ajit Manocha, SEMI President and CEO, said in a statement.
The report also highlighted the influence of government support in semiconductor manufacturing to bolster economies and security worldwide, Manocha said. “This trend is expected to help significantly narrow the equipment spending gap between re-emerging and emerging regions and the historical top-spending regions in Asia,” he said.
China, one of the world’s largest manufacturers of electronics products, is pushing to reduce reliance on foreign suppliers of chips amid strained geopolitical strains and heighted focus on security by President Xi Jinping. The Financial Times reported today that China government has introduced guidelines that phase out purchases of chips from U.S. suppliers Intel and AMD for government-used PCs and servers. Microsoft Windows and foreign database would also be sidelined, it said.
The Americas is projected to double 300mm fab equipment investments from $12 billion in 2024 to $24.7 billion in 2027. Just this past week, the U.S. Commerce Department announced a preliminary agreement to provide $8.5 billion to support four new Intel Corporation semiconductor manufacturing sites in Arizona, New Mexico, Ohio and Oregon. Elsewhere in the world, equipment spending in Japan, Europe & the Middle East, and Southeast Asia are expected to reach $11.4 billion, $11.2 billion, and $5.3 billion in 2027, SEMI said.
Demand for greater data throughput, crucial for AI servers, is driving strong demand for high-bandwidth memory, or HBM, and spurring increased investment in memory technology, SEMI noted. Among all segments, memory ranked second and was predicted to generate $79.1 billion in equipment purchases in 2027, reflecting a 20% annual rise from 2023, the industry group said.
See related posts:
AI Winners Likely To Buoy Taiwan Stocks After Election
Apple Supplier Repeats Atop List Of China’s Top Businesswomen
@rflannerychina
