China's impact on the semiconductor industry: 2013 update

Continuing to grow
China’s impact on the semiconductor
industry: 2013 update

Raman Chitkara talks about China's growing impact on the global semiconductor industry

China's impact on the semiconductor industry

Worldwide semiconductor consumption market by region, 2003–2012

In 2012, for the first time ever, China accounts for more than half of worldwide semiconductor consumption.

Continuing to grow

In 2004 when we published our first report on China’s impact on the semiconductor industry, we were responding to our clients’ concerns that China’s growing semiconductor production would cause over-capacity in the global market. Interestingly, it is not China's semiconductor production, but its semiconductor consumption which is creating headlines. In 2012, China’s semiconductor consumption market grew by 8.7% (in contrast to a 3% decline in the worldwide market) to reach a new record of 52.5% of the global market. Continued strong global demand for smartphones and tablets---the lion’s share of which are produced in China---is the main reason for this continued strong growth in semiconductor consumption and will continue to be a factor in the coming years.

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And while the growth of semiconductor production in China has fallen short of some expectations, it is nevertheless remarkable, rising 9.6% in 2012 and representing about 12% of the worldwide industry. But the production/consumption gap continues to grow and represents an unparalleled market opportunity. What remains to be seen, however, is whether it will be local Chinese companies or the large multinationals jumping in to fill the gap and make the most of this market opportunity.

This year’s report, despite being shorter in length, includes an updated look at both consumption and production, design, and manufacturing as well as government goals and incentives for this fast-growing industry. It explores the evolving roles in Greater China, evaluates progress against growth scenarios originally set in 2004 (and revised in 2011) and examines the growth of semiconductor IPOs and patents as a measure of a maturing industry.

Click here to read more details on the report page.


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Raman Chitkara
Global semiconductor leader
+1 (408) 817 3746
Jianbin Gao
Technology industry leader, China
+86 21 2323 3362