In recent years, China's chip industry has continued to increase its weight, striving to catch up with the world's leading TSMC. However, although Chinese chips have made certain achievements in expanding production, for TSMC, they still maintain a leading position in technology and production capacity in cutting-edge fields. In the face of the progress of China's chips, TSMC Chairman Zhang Zhongmou frequently issued warnings, saying that the expansion of mature processes is only a façade and may lead to a situation of overcapacity. However, with the global chip foundry giants cutting prices and the decline in demand for automotive chips, Zhang Zhongmou's warning seems to have come true.
In the face of the rise of Chinese chips, TSMC's competitors have joined the ranks of price cuts, trying to snatch TSMC's customers on the **. Samsung, one of the world's leading chipmakers, also joined the price cut and cut prices by between 5% and 15% in the first quarter. In addition to Samsung, chip foundries such as UMC, VIS and PSMC have also proposed price cuts, and only TSMC still holds the first place in market share. The main reasons for the price reduction are the competition for TSMC customers and the current poor market demand, excess inventory and weak orders. Chip foundries hope to adjust their inventories by cutting prices and maintain competitiveness through certain concessions.
Different from the past period of core shortage, the current slowdown in market demand has been effectively confirmed. Take Intel's self-driving company Mobileye as an example, their revenue in the current quarter will fall by 50% year-on-year, and profits are not optimistic. In addition, many Taiwanese chipmakers are still waiting for new orders while cutting prices, because they believe that upstream customers' efforts to start production of foundries are gradually weakening. Obviously, the slowdown in market demand has spread to the semiconductor industry around the world. In such a situation, continuing to invest more and not being able to control production capacity will suffer serious consequences.
Faced with the risk of overcapacity, Chinese chip companies need to actively adjust their inventories and find new ways out. We can consider opening up new application fields through technological innovation to enhance the added value and competitiveness of products. In addition, strengthening cooperation with global partners to jointly promote technology research and development and market development is also an effective way to solve the problem of overcapacity. In addition, we should also actively promote industrial upgrading, transformation and upgrading, and increase support for the chip industry.
For Chinese chip companies, Zhang Zhongmou's warning is a timely reminder. While increasing production expansion, it is necessary to think deeply and plan to avoid falling into the dilemma of overcapacity. At the same time, strengthening technological innovation and market expansion, improving product added value and market competitiveness are the key to China's chip enterprises to get out of the predicament. Only on the basis of strengthening cooperation, innovation-driven, and fine management can China's chip industry achieve sustainable development and occupy a place in the global chip market.
Summary: The rise of China's chips not only represents the improvement of technical strength, but also the embodiment of China's manufacturing strength. However, in the process of catching up, we must also be aware that due to the particularity of the global chip market, the risk of overcapacity exists at any time. Therefore, we need to keep a cool head, formulate a reasonable development strategy, pay attention to technological innovation and the improvement of market competitiveness, and lay a solid foundation for the sustainable development of China's chip industry. At the same time, we should also increase support for the chip industry, provide a better development environment and policy support for Chinese chip companies, and achieve the goal of industrial upgrading and transformation and development. Only with the joint efforts of all parties can China's chip industry stand out from the global competition and achieve the goal of sustainable development and rise.