China-based National Silicon Industry to double wafer production capacity to foster self-reliant chip ecosystem

Jingyue Hsiao, DIGITIMES Asia, Taipei 0

Credit: Yicai

National Silicon Industry, the top wafer provider in China by market share, announced a plan to double its wafer production as the country has been growing its self-reliant semiconductor ecosystem.

According to an official announcement on June 12, China-based National Silicon Industry plans to invest CNY13.2 billion (approximately US$1.82 billion) to double its production capacity of 300mm silicon wafers for integrated circuits. Following completion, the company's monthly capacity for 300mm wafers will increase from the current 600,000 wafers to 1.2 million wafers.

The third-phase investment includes Taiyuan and Shanghai projects. The Taiyuan project is expected to have a total investment of about CNY9.1 billion, with an epitaxy capacity of 600,000 wafers per month and a cutting, grinding, and polishing capacity of 200,000. The Shanghai project is expected to have a total investment of approximately CNY4.1 billion, with a monthly cutting, grinding, and polishing capacity of 400,000 wafers.

According to the announcement, this investment aims to align with China's semiconductor development strategy, advance its long-term strategic goals, optimize its portfolio, enhance competitiveness, and capitalize on opportunities to expand its market share.

According to Chinastarmarket, as of the end of 2023, National Silicon Industry had achieved a total monthly production capacity of 450,000 300mm wafers, reaching full production output for its first-phase project. The company is expected to complete its second-phase project and reach its target monthly production capacity of 600,000 300 mm wafers by the end of 2024.

Chinastarmarket reported, citing an unnamed source at National Silicon Industry, that the expansion is driven by anticipated future demand. Despite the company's performance being somewhat impacted in 2023 by cyclical factors in the semiconductor industry, they remain optimistic about the medium to long-term outlook. They point to the rapid advancements in new energy vehicles, big data, and AI as key drivers for sustained growth in the semiconductor industry.

According to National Silicon Industry's annual report, its sales fell from CNY3.6 billion in 2022 to CNY3.19 billion in 2023. Profits attributable to shareholders declined by 42.61% to CNY1.8 billion for the same period.

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Source: National Silicon Industry, April 2024