Semiconductor equipment, the "killer mace" of US sanctions against SMIC

Although the news of the United States "blocking" SMIC is "untrue" for the time being, one fact must be true that the United States will do its utmost to suppress the development of China's science and technology.The market believes that the biggest killing effect of US sanctions on SMIC comes from banning semiconductor equipment vendors from selling equipment to SMIC.As a result, SMIC cannot upgrade new processes or expand production capacity.

Semiconductor equipment is in the upper reaches of the industrial chain, supporting manufacturing and packaging testing. The semiconductor industry has high technology and rapid progress. A generation of products needs a generation of process, and a generation of process requires a generation of equipment. Semiconductor equipment is the technical leader of the semiconductor industry.Usually, the research and development of semiconductor equipment is three to five years ahead of the semiconductor process. Semiconductor equipment belongs to high-end manufacturing equipment, and its value is relatively high. The unit price of high-end EUV lithography machine is more than 100 million US dollars.

According to the semiconductor manufacturing process, it can be divided into three links: wafer manufacturing, wafer processing and packaging testing, accounting for 5%, 80% and 15% respectively, with the largest proportion of wafer processing.

Lithography machine, etching machine, thin film equipment (CVD) technology is the most difficultThe share is the highest, with the global market size of US $12.7 billion, US $10.6 billion and US $10.6 billion respectively in 2019, all exceeding US $10 billion.

Semiconductor equipment shows a pattern of oligopoly.According to VLSI, the top five equipment companies with global semiconductor equipment sales revenue in 2018 are AppliedMaterial, ASML, Tokyo Electronics, LamResearch and KLA.The market concentration of the top five is as high as 82%, and the market is almost occupied by the leaders of the United States, Japan and Europe.And SMIC's prospectus revealsSMIC's three largest equipment suppliers are AppliedMaterial,ASML and Lam Research.

Can domestic semiconductor equipment support Semiconductor Manufacturing International Corporation?

The equipment in the United States can't be used, can we use the domestic one?

At present, local enterprises have made breakthroughs in all kinds of semiconductor key process equipment, but there is still a gap compared with overseas manufacturers in the field of advanced processes.According to China International Capital Corporation data, the current domestic equipment coverage of the 12-inch production line is 30-40%, but the cut-in proportion of domestic equipment on the real production line is only about 10%.

Take North Huachuang, the largest semiconductor equipment manufacturer in China, as an example, the company currently has a market share of 0.5% and 1.1% in the areas of etching and deposition, respectively.In order to ensure the product yield, the advanced process production line will still focus on purchasing overseas equipment at present.After the domestic equipment has passed the customer verification and the downstream customer capacity has climbed smoothly, the proportion of domestic equipment is expected to increase, while in the middle and low-end process (above 28nm), the import substitution rate is expected to be significantly improved.

However, after years of cultivation, domestic semiconductor equipment has made great progress, basically covering all kinds of key equipment, the overall level has reached 28nm, and some breakthroughs have been achieved in 14nm and 7nm.

1) in the 28nm field:Etching machines (northern Huachuang, medium and micro semiconductors), thin film deposition equipment (northern Huachuang, Shenyang Tuojing), oxidation diffusion furnace (northern Huachuang), cleaning equipment (northern Huachuang, Shanghai Shengmei) and ion implanter (electronic equipment of Sinopec) have achieved mass production.

2) in the 14nm field:Silicon / metal etching machine (Northern Huachuang), thin film deposition equipment (Northern Huachuang), monolithic annealing equipment (Northern Huachuang) and cleaning equipment (Shengmei Semiconductor) have been successfully developed and are being verified by the client.

3) in the 7nm field:The medium etching machine of 7nm has been successfully developed by medium and micro semiconductors. In addition, the 8-inch CMP equipment produced by CLP electronic equipment has been verified on the client side, and Shanghai Microelectronics has also realized the import substitution of 90nm lithography machine.

In the short term, it is unrealistic for SMIC to completely get rid of the "neck jam" of foreign equipment manufacturers, but in the long run, domestic semiconductor equipment may be able to support Semiconductor Manufacturing International Corporation.

SMIC was in trouble, Qualcomm Inc became the first big victim.

Under the constant "harassment" of Semiconductor Manufacturing International Corporation by similar rumors, the biggest victim has emerged, that is, the American businessman Qualcomm Inc.Qualcomm Inc is the second customer of SMIC after Huawei. SMIC mainly produces power management (0.18 μ m) and low-end AP/SoC (28nm, 14nm).

Qualcomm Inc's latest generation of power management chips PMIC for the 5G generation needs about 1.5 million 8-inch wafers a year, which are eaten by Taiwan Semiconductor Manufacturing Co Ltd and Semiconductor Manufacturing International Corporation. It is estimated that Taiwan Semiconductor Manufacturing Co Ltd will get an order of 900000 pieces a year, and Semiconductor Manufacturing International Corporation will get about 600000 pieces.In the future, once Semiconductor Manufacturing International Corporation is punished by the United States, Qualcomm Inc will no longer be able to take the production capacity of the power management chip PMIC with Semiconductor Manufacturing International Corporation.

2020Q2 8-inch wafers have a monthly production capacity of 234000 wafers, accounting for 48.73% of the total production capacity.

According to the supply chain, as soon as the news that Semiconductor Manufacturing International Corporation was locked in the United States came out, Qualcomm Inc immediately asked all the fabs around the world to increase the price to get 8-inch production capacity, for fear that the power management chip PMIC would be out of stock. however,Now that the global 8-inch wafer production capacity is desperately short, who is Qualcomm Inc looking for to make up for the 600000 pieces of power management chip PMIC production capacity this year?

Qualcomm Inc's crazy move to increase prices and grab production capacity has also made colleagues such as MediaTek very nervous, because everyone is short of production capacity, and sometimes it is not useful to increase money in the "Tuhao style" style. If there is no production capacity, there is no production capacity.

Therefore, this crisis has indirectly caused the whole IC industry to fall into a state of "out of order". The supply chain also revealed that due to the lack of 8-inch production capacity of Taiwan Semiconductor Manufacturing Co Ltd, United Microelectronics Corp, GlobalFoundries, World Advanced, etc., it seems to benefit Samsung, because Samsung may have got some of the orders transferred by Qualcomm Inc from Semiconductor Manufacturing International Corporation.