As China, which declares to make an aggressive move to boost the local semiconductor industry, has been making a huge investment in semiconductor facilities and buying home-born equipment, it is likely to become the world’s second largest semiconductor equipment market next year, threatening South Korea. Accordingly, South Korean, Chinese and Taiwanese companies will intensely compete in the global semiconductor equipment market worth US$53 billion (58.27 trillion won).
According to the Semiconductor Equipment and Materials International (SEMI) on November 19, the combined sales of Chinese semiconductor equipment producers will come to US$11 billion (12.09 trillion won) next year, up 61.5 percent from US$6.8 billion (7.48 trillion won) this year. China ranked third in terms of amount of equipment orders in 2016 with US$6.5 billion (7.15 trillion won) after Taiwan with US$12.2 billion (13.41 trillion won) and South Korea with US$7.7 billion (8.47 trillion won). However, the country is expected to take the second place after South Korea with US$13.3 billion (14.62 trillion won) next year. Taiwan is expected to come in third with US$10.9 billion (11.98 trillion won) next year. South Korea has dethroned Taiwan to gain its status as the world’s top semiconductor market for the first time this year and it is highly likely to maintain the number one spot next year as well.
The global semiconductor equipment market grew 19.8 percent from US$41.2 billion (45.3 trillion won) last year to US$49.4 billion (54.32 trillion won) this year. It is also expected to increase 7.7 percent further to US$53.2 billion (58.49 trillion won) next year, reaching a record high.
According to the China Electronic Equipment Industry Association, the combined sales of China’s major semiconductor equipment manufacturers is expected to stand at 7.65 billion yuan (US$1.15 billion or 1.27 trillion won) this year, up 33 percent from last year. Chinese major semiconductor equipment producer in have recently succeeded in localizing major semiconductor equipment and materials like etching agents that are used in dry etching equipment and semiconductor surface etching for an advanced semiconductor packaging process.
The South Korean equipment industry said that it is only a matter of time for China to become the number one in the global semiconductor equipment market because China will purchase more of domestically produced semiconductor equipment. Earlier, China's largest chip designer Tsinghua Unigroup announced its plan to invest 77 trillion won (US$70.03 billion) to build three memory chip plants in China this year. In addition, there are concerns that China can acquire South Korean equipment material companies with huge financial resources.