Nowadays, RF chips play a vital role in smartphones. It is responsible for the reception and transmission of mobile phone signals, frequency synthesis, power amplification and other important functions. It can be said that without the existence of RF chips, mobile phones will not be able to carry out basic functions such as calls and text messages. However, the RF market is highly concentrated and is mainly monopolized by American companies. According to the data, before 2022, the five major manufacturers accounted for 80% of the RF market. The five vendors are Broadcom (19%), Qualcomm (17%), Qorvo (15%), Skyworks (15%) and Murata (14%). In contrast, domestic companies in the field of RF chips are more focused on 2G, 3G and other relatively mature technologies, while 5G RF chips have a very small share or even can not be independently developed, which is also one of the important reasons why domestic mobile phone manufacturers use RF chips from the United States and Japan in 5G mobile phones.
However, it has recently been reported that the US RF chip giant Qorvo intends to ** factories in Beijing, China and Dezhou, Shandong, and the assets of the transaction include property, plant, equipment and existing employees. The Chinese company that will take over the two factories is Luxshare Precision, which will assemble and test Qorvo's products and provide it with seamless, flexible, best-in-class production capacity under a new long-term agreement, while expanding its products and capabilities. In other words, Qorvo plans to separate the design and manufacturing processes from the manufacturing and testing facilities**, leaving only the R&D center to separate the design and manufacturing processes, while Luxshare Precision will take over the manufacturing and testing facilities and undertake Qorvo's foundry tasks. Of course, this transaction is only a preliminary agreement reached between the two companies, and the final transaction will depend on the review of the regulatory authorities, both whether the United States agrees to Qorvo's ** and whether China agrees to accept it. However, the key to a deal between the two countries is whether the United States agrees**, and China is likely to agree on the surface. Some netizens believe that this transaction did not obtain core assets, because the R&D center is not included, and it is only a foundry. However, in the chip space, foundry manufacturing is a core asset. In addition, the manufacturing threshold of 5G RF chips is very high, and Lixun Precision itself is not involved in chip manufacturing and testing, and this acquisition allows it to enter the field of chip foundry and testing, especially the foundry and testing of 5G RF chips, so this is a far-reaching and valuable acquisition.
For China, this transaction undoubtedly provides a huge opportunity for China's RF chip industry. By taking over Qorvo's factory, domestic companies can gain access to the most advanced 5G RF chip manufacturing and testing technology, improve their own capabilities, and occupy a more competitive position in the 5G field. At the same time, this transaction is also good news for Chinese mobile phone manufacturers, who will have more choices, reduce their dependence on foreign RF chips, and further enhance their independent research and development capabilities and market competitiveness.
The importance of RF chips is not only reflected in the field of mobile phones, but also widely used in the Internet of Things, smart home, autonomous driving and other fields. With the advent of the 5G era, the demand for RF chips will further increase, especially the demand for 5G RF chips. Therefore, this transaction has far-reaching significance for the entire RF chip industry, which is expected to promote the development of the national first-frequency chip industry and provide new opportunities and challenges.
Although domestic companies have made certain achievements in the field of radio frequency such as 2G and 3G, there is still a certain gap compared with international giants. At present, American companies still occupy a dominant position in the RF chip market, and their technical strength and market share far exceed those of other countries. Moreover, the technical threshold in the field of RF chips is high, requiring skilled design and manufacturing processes, which is a challenge for Chinese companies. Therefore, in order to make a breakthrough in the RF chip market, it is necessary to increase investment, enhance R&D strength, and improve product quality and performance in order to compete with international competitors.
However, this opportunity to take over the Qorvo plant provides an opportunity for domestic companies to make a breakthrough. Through the partnership with Qorvo, Luxshare Precision has access to advanced manufacturing and testing technologies to enhance its capabilities. At the same time, China is also actively promoting the development of the RF chip industry, providing a series of policies and support measures, providing a good environment for enterprise R&D and innovation, and providing a solid foundation for domestic enterprises to make breakthroughs in the field of RF chips.
Independent and controllable is an important direction for the development of the national first-frequency chip industry. In the international RF chip market, Chinese companies are still in a weak position and need to rely on the technology and equipment of foreign companies. By taking over Qorvo's factory, domestic companies can master advanced RF chip manufacturing and testing technologies, and realize a closed loop of the entire industry chain from equipment manufacturing to technology research and development. This will help promote the development of the national frequency chip industry, reduce the dependence on foreign RF chips, and improve the market competitiveness of domestic RF chips.
In addition, domestic enterprises can also learn from their advanced management and operation experience through cooperation with Qorvo, and improve their own management level and efficiency. At the same time, through this acquisition, Luxshare Precision will realize the entry into the field of RF chip foundry and accelerate the development of the national first-frequency chip industry.
The manufacturing and testing technology of RF chips is a difficult field, which has high requirements for design and technology. By taking over Qorvo's factory, domestic companies can work directly with international RF chip giants to learn advanced technologies and processes, and improve their own technical level and product quality. This will help domestic enterprises reduce the R&D cycle, improve R&D efficiency, and bring more business opportunities to the company.
At the same time, through cooperation with international enterprises, domestic enterprises can also expand overseas markets and improve competitiveness. With the advent of the 5G era, the demand for RF chips will further grow, and domestic enterprises can seize the opportunity to increase technology research and development and market expansion, enhance their own strength, participate in international competition, and realize the transformation from passive following to active leading.
By taking over Qorvo's factory, Luxshare Precision will bring great opportunities to China's RF chip industry. This transaction can not only improve the manufacturing and testing capabilities of domestic enterprises and develop the 5G RF chip industry, but also promote the development of the national first-frequency chip industry and realize the transformation from passive following to active leading. Despite facing fierce market and technical challenges, through cooperation, increased investment, and improved R&D strength, I believe that China's RF chip industry will be able to usher in a better future. At the same time, we should also strengthen the support and guidance of the RF chip industry, provide a better environment and policies for enterprises, and further promote the healthy development of the RF chip industry.
In the context of globalization, the development of the RF chip industry is not only related to the fate of an enterprise, but also to the industrial competitiveness of the whole country. It is hoped that Chinese enterprises can seize this opportunity, actively participate in international competition, continuously improve their own strength and market competitiveness, promote the development of the RF chip industry, and make greater contributions to the development of China's RF chip field. At the same time, it is hoped that the best can increase support for the RF chip industry, provide a better policy environment and industrial ecology, and provide a good guarantee for the development of enterprises. Only through the joint efforts of all parties can we achieve the leapfrog development of the RF chip industry and further enhance China's position in the global chip industry chain.