-
- News
- Books
Featured Books
- smt007 Magazine
Latest Issues
Current IssueCounterfeit Concerns
The distribution of counterfeit parts has become much more sophisticated in the past decade, and there's no reason to believe that trend is going to be stopping any time soon. What might crop up in the near future?
Solder Printing
In this issue, we turn a discerning eye to solder paste printing. As apertures shrink, and the requirement for multiple thicknesses of paste on the same board becomes more commonplace, consistently and accurately applying paste becomes ever more challenging.
A Culture of Thriving
One cannot simply command thriving; it must be nurtured, developed, and encouraged. In this issue, we explore strategies to improve your working relationship model—both internally and externally. In this culture of thriving, your business will grow in the process.
- Articles
- Columns
Search Console
- Links
- Media kit
||| MENU - smt007 Magazine
Accelerated Order Shift Effect from U.S. Tariff Barriers Boosts Utilization Rates at Taiwanese Semiconductor Foundries Beyond Expectations
May 22, 2024 | TrendForceEstimated reading time: 2 minutes
The White House announced new tariffs on Chinese imports on May 14th, including a 50% tariff on semiconductor products manufactured in China, which will take effect by 2025. TrendForce reports that this move has accelerated a shift in supply chains, resulting in increased orders for Taiwanese foundries, which are now seeing higher-than-expected capacity utilization rates. In the second half of this year, Vanguard's capacity utilization rate is expected to rise above 75%, PSMC's 12-inch capacity utilization rate will reach between 85 to 90%, and UMC's overall capacity utilization rates are projected to reach 70–75%.
The global wafer foundry market has been in a downturn since 2H22 as pandemic-induced high inventory levels forced the supply chain to spend over a year correcting this imbalance. The trend of order transfer resulting from geopolitical tensions and pandemic-induced supply chain disruptions has also slowed down with the downturn in the industry despite customers actively seeking to start new projects with Taiwanese foundries. Due to the high inventory pressure and cost considerations, most customers maintained their cooperation with Chinese foundries to reduce costs, delaying the ramp-up of new projects with Taiwanese foundries.
As inventory adjustments for consumer products near completion, components for smartphones, TVs, and LCD monitors (such as TDDI, large-size DDI, PC MOSFET, and consumer MCUs) have seen inventory replenishment orders from 4Q23 to 2Q24, benefiting companies like SMIC, HHGrace, HLMC, Nexchip, UMC, Vanguard, and PSMC. However, high inflation has suppressed consumer demand, resulting in short-term and urgent orders with low visibility. TrendForce initially estimated that capacity utilization rates for wafer foundries would bottom out in 1Q24, then gradually recover with sporadic inventory replenishment orders in Q2, with 8-inch capacity utilization rising to around 70% and 12-inch to 75–85% in the second half.
The supply chain’s order-shifting has become more proactive with the imposition of US tariffs. Qualcomm, which began cooperation discussions with Vanguard in 2021, has made its production plans more aggressive this year. This has prompted Vanguard to expand the first-phase capacity of its new Fab5 plant by 3Q24 and to complete cross-plant validation for Qualcomm's PMIC to meet demand. Since 2022, MPS has also started shifting orders, including plans with both Vanguard and PSMC.
Additionally, Cypress and Gigadevice are discussing NOR Flash production plans with PSMC, expected to take effect from the second half of this year to 2025. Raydium and OmniVision, based on end-customer requirements, plan to shift PC DDI and CIS manufacturing to Vanguard and PSMC. UMC has recently received additional orders from Infineon, leveraging its diverse production locations to attract long-term cooperation plans from European and American customers like TI, Infineon, and Microchip.
Overall, despite the White House's announcement of upcoming tariff increases, the specifics of implementing semiconductor-related tariffs remain unclear. Current assessments indicate that high tariffs will primarily target two areas: Chinese-manufactured products rather than Chinese brands, and the chips themselves—excluding those already installed in end devices (except for EVs). Therefore, TrendForce believes the accelerated order shift observed is mainly for projects that had already started with Taiwanese foundries but were delayed due to market downturns. Whether these tariff barriers or subsequent actions by the US government will further impact the wafer foundry landscape remains to be seen.
Suggested Items
iNEMI End-of-Project Webinar: Investigation of AI Enhancement to AOI for PCBA
10/25/2024 | iNEMIAutomated optical inspection (AOI) systems are essential in electronic manufacturing for ensuring the quality of printed circuit board assemblies (PCBAs).
U.S. Army Awards RTX's Raytheon TOW Contracts for $676 Million
10/24/2024 | RTXRaytheon, an RTX business, was awarded $676 million to continue manufacturing the tube-launched, optically-tracked, wireless-guided TOW® weapon system for the U.S. Army.
Molex Drives Intelligent Supply Chain Collaboration with SAP Solutions
10/24/2024 | PRNewswireMolex, a global electronics leader and connectivity innovator, announced a highly successful collaboration with SAP to unite a global community of suppliers and buyers as part of Molex's multi-year, intelligent digital supply chain transformation strategy.
Global Citizenship: Comparing and Contrasting the U.S. and China PCB Industries
10/23/2024 | Tom Yang -- Column: Global CitizenshipI have spent a lot of time in the U.S., and one question I am frequently asked is about the differences between the Chinese and U.S. PCB industries. It’s always an interesting question, and I will try to answer it in this month’s column. Certainly, the U.S. was the leader in PCB manufacturing, including developing the processes and technology, which it taught to the Chinese in the late 1980s and ’90s. As a result, China has become a force to be reckoned with in the global PCB market. Having been educated in America and now leading a major PCB manufacturing company in China, I have a unique vantage point when it comes to comparing the two nations’ approaches to PCB production.
Yamaha Robotics Appoints Roberto Ferraretto New Area Manager for Italy
10/23/2024 | Yamaha RoboticsYamaha Robotics SMT Section has announced that Roberto Ferraretto has joined the team as Area Manager for Italy, to support the Company’s range of printers, mounters, inspection systems, and software for high-speed surface-mount and hybrid assembly.