In 2017, the sales value of local IC companies reached approximately USD 80.15 billion, representing an increase of more than 20% YOY. Among it, that of the IC manufacturing industry reached about USD 21.55 billion, and that of the design industry and the packaging and testing industry were respectively USD 30.71 billion and USD 27.99 billion.
According to CRI’s research, China’s integrated circuit industry continues to develop after joining the WTO, but still far lags behind the global advanced level. Compared with leading international companies, China’s chip manufacturing industry is at least 1 to 2 generations behind in terms of the advanced technologies. The IC design in China still stands at a low level and makes single products. The gap of technologies on packaging and testing between Chinese companies and International mainstreams is to be bridged. Besides, China’s high-end IC products heavily rely on imports. In 2017, China imported 377 billion units of integrated circuits, with an increase of 10.1% YOY, and the import value reached USD 260.14 billion, with an increase of 14.6% YOY. In the same year, China exported USD 66.88 billion of integrated circuits, with a deficit of nearly USD 200 billion. China is already an important market for global chip companies. For example, in 2017, the sales value of several major US chip companies to China exceeded USD 50 billion. Among them, more than half of the sales revenue of Qualcomm, Broadcom, Micron, Marvell and Skyworks came from the Chinese market.
CRI considers that segments such as automotive electronics, industrial automation, internet of things and communications equipment have been the main driving force for China’s integrated circuit market in recent years. The global PC production has been on the decline while that of smart phones is likely to increase. At the same time, the development of related industries such as cloud computing, internet of things and big data has propelled the demand for integrated circuits.
In China, the production and sales volumes of consumer electronics and traditional home appliance basically remain stable. Driven by the upgrading of consumption and smart home appliances, the IC market has grown slightly. The main drivers for such growth arise from the increase in smart mobile devices and the rapid growth of emerging consumer electronics products such as drones.
China is the world’s largest automotive producer and consumer, as well as the largest electronics manufacturing base and the largest manufacturing outsource base in the world. It is expected that China will remain the world’s largest IC consumer market for a long time, and the market size will continue to grow. In recent years, automotive electronics has been a hot area in the global IC market. In 2017, the auto production in China reached 29.02 million units, with an increase of 3.2% YOY, of which new energy vehicles (electric vehicles) were 794,000 units, with an increase of approximately 54% YOY. The demand for integrated circuits of each new energy vehicle far exceeds that of traditional fuel vehicles. With the rapid increase in the production of new energy vehicles in China, the automotive sector has become an important driver for the growth of the IC market.