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posted by janrinok on Monday February 05, @11:04PM   Printer-friendly

Arthur T Knackerbracket has processed the following story:

Semiconductor testing company Teradyne recently confirmed to Reuters that it had to pull $1 billion of equipment out of China because of supply chain disruptions.

Teradyne manufactures automated testing equipment that plays an important role in chip fabs around the world. 

“We did manufacturing in China, so we had to get an emergency authorization to continue that activity,” Brian Amero, the company’s global director of compliance, is quoted by Reuters as saying. “We decided that was too risky so we moved manufacturing out of China — at no insignificant expense.”

Amero said that Teradyne had not been a “direct target” of the rules regarding supplying equipment to China.

While China is making significant strides in developing its domestic semiconductor industry, the country is still reliant on a foreign supply chain to service it.

Teradyne has been highlighted in previous reports about how reliant Chinese firms are on US semiconductor equipment suppliers, which control 80% of the market for such equipment.

A DigiTimes report from last July highlighted how China’s semiconductor equipment imports have fallen sharply, with a 24.4% quarter-on-quarter decrease in late 2022 and a further 28.1% drop in early 2023.

In total, China imports about $31 billion in semiconductor equipment a year, from firms including US-based Teradyne, Japan-based Tokyo Electron, and Netherlands-based ASML.

In 2019, China launched a $29 billion fund to help rid itself of this reliance. Last September, it announced further monetary incentives in the form of new tax credits.

[...] Beijing’s goal is for its industry to use 70% locally produced equipment.

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  • (Score: 3, Interesting) by crafoo on Tuesday February 06, @05:04AM (3 children)

    by crafoo (6639) on Tuesday February 06, @05:04AM (#1343275)

    while $29bil is quite a bit of money, it is a tiny drop in the bucket of what it will take to re-create a company with tech and domain knowledge of something like ASML. More like 2-3 decades and a 100s of billions of dollars. Actual, physical hardware production is very hard, and to start from near 0 takes decades.

    I'm also reminded of the previous attempt China made to kickstart a semiconductor industry. The best they could do was low-power LED production plants. Many of their startup foundries were never profitable and closed.

    Anyway, best of luck to them. It would be interesting to see the types of tech they come up with.

    • (Score: 2, Touché) by shrewdsheep on Tuesday February 06, @08:50AM

      by shrewdsheep (5215) on Tuesday February 06, @08:50AM (#1343304)

      Never underestimate the power of sending a few moles to the competitor.

    • (Score: 3, Informative) by Anonymous Coward on Tuesday February 06, @08:58AM (1 child)

      by Anonymous Coward on Tuesday February 06, @08:58AM (#1343306)

      I am leery of "weaponizing" trade as it forced the customer to replace me.

      How many times have I had to find alternatives to a product only because some business made it a PITA to deal with them? AOL? AT&T? Several businesses that price me out of their store if I don't embrace their loyalty program ( by clicking "agree" button for pages of legalese that would take me days to read. )

      Heck, even nations have to create their own financial settlement systems (BRICS) to to humor the US "Sanctions".

      I completely fail to understand the outsourcing frenzy embraced by American government, apparently convinced USA is " too big to fail".

      I fear we will inevitably legally transfer ownership of our nation to the banking class a when we dig ourselves in so deep in debt that the ownership classes foreclose. I believe this outsourcing of factories along with relentless "raisings of the debt ceiling" is a plan for taking over ownership of this nation without having to go to war. It will all be done with a pen.

      • (Score: 0) by Anonymous Coward on Tuesday February 06, @05:05PM

        by Anonymous Coward on Tuesday February 06, @05:05PM (#1343344)

        Apropos nothing except weird connections that my memory sometimes makes:

        > is a plan for taking over ownership of this nation without having to go to war.

        Reminded me that an earlier suggested solution to the Israel/Palestine land situation would be for Israel to purchase the land they want for a fair price. Or, going back even further, England (for example) could have purchased the land when Israel was first starting out after WWII.

        IANAH (not a historian), so feel free to correct any of this...