China’s brilliant 31.6 billion chip units production in July gives hope that the silicon crisis can be solved soon

According to sources, the current Integrated Circuit output of the Chinese semiconductor manufacturing industries has hit a whopping 31.6 billion units in July. This is an increase of 41.3% year on year thanks to the skyrocketing demands for semiconductor chips.

Many claims that the output produced is not only a big deal for the country but is also a huge boon to the semiconductor market that’s been suffering from shortages since early 2020. it has resulted in the downfall of the worlds automobile market with China’s output of automobiles falling by 15.8% in July.

However, the problem remains that to meet the current global this is all but a small amount. And the performance output of even the larger company’s of the country like the Semiconductor Manufacturing International Co. (SMIC) who are unable to get the required equipment it needs for expansion from large American companies due to the US restrictions is unable to match the performance and production output of its rival such TSMC and western chip fabs.

According to the National Bureau of Statistics, Chinese semiconductor makers have produced 203.6 billion chips so far in 2021, which is an amazing 47.3% increase year-over-year. With reports suggesting that most of these chips are being supplied for the implementation of everything from vehicles to consumer electronics, there is a slight hope that the crisis might be solved soon.

However, there are also reports that smaller domestic semiconductor companies are barring the overpressure of supplying their manufactured products. China in its bid to become self-dependent is investing heavily in the production of silicons. However, it is paying more attention to large scale companies like SMIC and forcing smaller companies to be absorbed by larger ones. It has been subsidizing its semiconductor industry for years in a bid to catch up to rival countries like Taiwan.

Products such as the PlayStation 5 or graphics cards from both Nvidia and AMD all source their semiconductors from Taiwan Semiconductor Manufacturing which makes most of the world dependant on Taiwan for chip supplies. If China aims to make itself a prominent player in the market then it has to attract the consumer base from TSMC. And it will do much better if the country can improve the performance of its chips to match up to the level of its competitors.


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