At the moment, we are faced with a shortage crisis which makes the supply of products of all types of material more scarce than usual. This leads the various manufacturers to seek solutions to survive, including Chinese companies under veto.
The problems of the minimum wage for survival
China is not a leader in terms of semiconductor production volume, as its largest foundry, known as SMIC, barely has a significant market share globally.
| Foundry | Wafers per month | Market share |
| Samsung | 3.1 million | 14.7% |
| TSMC | 2.7 million | 13.1% |
| Micron | 1.9 million | 9.3% |
| SK Hynix | 1.85 million | 9.0% |
| Kioxia | 1.6 million | 7.7% |
| Intel | 0.884 million | 4.1% |
No obstante la obligación en China de que cada empresa ha de estar participada por el Estado hace que se convierta en un problema ya geopolítico y geoestrategico, Por lo que desde los Estados Unidos tienen miedo de compartir su tecnología con China para no perder su hegemonía en the world. This led them to veto access to technology for manufacturing processors with more advanced nodes at the minimum wage.
This would have been enough to return the missing minimum wage. His approach to survive and overcome the veto? Using less advanced manufacturing nodes and betting on new packaging systems for processors, which means purchasing new equipment for manufacturing chips under old nodes.
China buys used equipment from Japan
At each manufacturing node of the different semiconductors, all the equipment of the previous node or at least a good part of it is totally out of use. This is one of the reasons why deploying a new node is so expensive, since it involves creating an entire factory to make chips. The veto of Chinese companies like the SMIC means they cannot buy the machines needed for production or access the technology needed to access theirs.
In an article in Nikkei Asia, it is reported that China is buying used equipment for manufacturing in order to circumvent US sanctions. This has led to a price increase in the used industrial equipment market. Due to the global chip shortage that we are experiencing, many manufacturers are buying out and even refitting old equipment.
Thus, the machines used for the production of chips which were previously on the verge of being scrapped are now in high demand by various manufacturers around the world, especially those in China.
From Nikkei Asia, they cite two sources for their information, the first is from Mitsubishi UFJ Lease & Finance
“Almost 90% of the machines (semiconductor production) already in use (in Japan) seem to be heading to China”
Regarding your second source from a second-hand (industrial) equipment reseller:
“Machines that were virtually completely useless several years ago are now sold for 100 million yen.”
All of this highlights the crisis we are going through in terms of manufacturing different semiconductors, which, combined with the veto suffered by foundries in China, forces us to find exceptional solutions for these days, ditto.
