Chip imports to China fell markedly in 2022 amid US sanctions, especially in October

Chip imports to China fell by more than 13% from January to October, according to Chinese customs, as the world's largest semiconductor market is affected by the growing trade standoff between the US and the Middle Kingdom as well as a general economic slowdown.
Source image: TSMSZThe first 10 months of the year, China imported 458 billion integrated circuits, which is 13.2% less than the 527.9 billion chips imported into the country in the same period last year.
In October the decline in imports markedly accelerated - during the first 9 months of decline was an average of only 12.8%.Decrease in supply volumes is also due to the fact that in 2021 the import of integrated circuits took off - during the first 10 months of growth then was 21.2% year-on-year, so it is difficult to keep up with these figures now.
But despite the decline in the volume of imports, higher prices for chips led to an increase in the value of supplies during this period by 1.3%, leaving $351.2 billion.
In general, chips have long been a major item of imports to China, at one time by the value of purchases such imports overtook crude oil and consumer goods.
Nevertheless, it began to decline at the beginning of this year, the first year-on-year decline since 2020.
The drop in imports in October was 13.7% (to 41.1 billion) compared to October 2021.
By comparison, 47.6 billion chips were imported in September.
The accelerated decline in purchases comes amid Washington's strengthening of export controls and coincides with a global decline in demand for semiconductors as a whole.Source image: TSMC7 October, the Bureau of Industry and Security - a unit of the U.S.
Department of Commerce announced a series of measures to control technology exports to China aimed at weakening the Chinese high-performance semiconductor sector - not only exports to the Middle Kingdom chips themselves, but also equipment for their manufacture, special permits for the production of semiconductors, and a number of other measures.
At the same time, the value of sold year-on-year increased by 6.2%.
The problem may be partly related to the outbreak of coronavirus in the country - due to sanitary restrictions, the ability to fulfill orders was also affected.

Intel has formed an alliance for trusted chip design and manufacturing for the US military

It has long been no secret that one of Intel's customers, who will begin receiving chips manufactured using the Ohio 18A process by mid-decade, will be the US Department of Defense.
The company has formed an alliance with other chip design partners to meet the requirements of this customer, creating a trusted environment for the design and manufacture of components on the U.S.
territory.Image source: Adobe StokKakAccording to a corporate press release, the association of companies received the designation USMAG (United States Military, Aerospace and Government) Alliance, in addition to Intel, it includes Cadence, Synopsys, Siemens Digital Industries Software, Intrinsix and Trusted Semiconductor Solutions.
The acronym of this alliance makes it clear that it aims to meet the needs of the U.S.
defense and aerospace industries, as well as the needs of any other U.S.
government agencies.The alliance members will have to certify component development and production procedures - both at the prototype production stage and on a mass scale.
All stages of the production cycle must meet the requirements of defense customers for the protection of intellectual property and reliability of the products themselves.
It should be recalled that GlobalFoundries, which is nominally considered a U.S.
company, has already gone the same way, having received not only the necessary certificates, but also having secured earmarked funding to increase the production of power electronics for the needs of the U.S.
defense sector.
Since Intel claims to receive government subsidies under a U.S.
law, the country's defense agencies have the right to expect reciprocal support from this chipmaker.

Chinese semiconductor industry accused the US of discrimination due to new restrictive measures

Chinese authorities have already formally protested the adoption of a package of laws by their US counterparts, which provides companies with subsidies to build facilities in the US in exchange for, among other things, a promise not to develop production in China for ten years.
In any case, vice chairman of the China Semiconductor Industry Association Yu Xiekang said without going into details at an event in Nanjing that parts of the US package of laws \"clearly discriminate against China\" and that the US initiative generally aims to support China's competitors in the foreign policy arena.
According to the industry association, some clauses of the US government's subsidy program for the national semiconductor industry contradict the fair trade principles supported by the WTO.According to Yu Sekan, the Chinese authorities should continue to support the national semiconductor industry in order to eliminate bottlenecks that hinder its further technological development.
Others at the event added that the U.S.
package of laws introduces more uncertainty into the development environment of the entire global industry, and Chinese authorities, educational institutions and companies should counteract this together.

Korean battery makers prepare to build 11 factories in the US

The US is immediately embarking on its own \"import substitution\" program.
South Korea's three largest electric vehicle battery companies plan to build 11 traction battery plants in the U.S.
by 2026, mostly in cooperation with U.S.
electric vehicle manufacturers.Image source: FordFor example, LG Energy Solution plans to build six production bases in the U.S.
by 2026.
It is the most active player among Korean battery manufacturers, constantly expanding its production.LG Energy Solution has already established a joint venture with General Motors Ultium Cells - construction of a plant with a production capacity of 35 GW∙h or more has already begun in Ohio, and a second plant (35 GW∙h or more) in Tennessee.
A third plant (over 50 GWh) should begin mass production in Michigan in 2025.
A plan for another plant will be discussed in detail this year.
In addition, the company is independently building a plant for cylindrical batteries in Arizona and intends to expand its own production capacity in Michigan.SK On plans to build four battery plants in the U.S.
The company is already building facilities with a total production capacity of 129 GW∙h in Kentucky and Tennessee.
The Blue Oval SK joint business is being implemented together with Ford, and work is expected to begin in 2025.In addition, Sk On is building two of its own plants in Georgia.
It is known that Hyundai Motor Group plans to build an electric car plant in the same state, so it is very likely that these businesses will cooperate in this state.Samsung SDI decided to create a joint business for the production of traction batteries together with Stellantis.
The plan is to start producing battery cells in the U.S.
in 2025.
When construction is completed, the production capacity will be 23 GWh.
In the future, production will be expanded to 40 GW∙h.

Hyundai will invest about $5.54 billion in electric car and battery production in the US

The US is the third-largest market for electric cars, but local production, other than at Tesla, is relatively underdeveloped.
Following the example of many competitors, Korea's Hyundai Motor has decided to build an electric car and traction battery manufacturing facility in the U.S.
It will be located in Georgia and will start assembling electric cars in the first half of 2025.Image source: Hyundai MotorConstruction of the new facility will begin in 2023, and the design capacity implies the production of 300,000 electric cars per year.
This is not the only enterprise of Hyundai in the USA which will be able to establish production of electric cars for the local market.
A part of production lines in Alabama will be re-profiled for these needs and it will be spent $300 mln for these purposes.
In general, Hyundai intends to direct $7.4 bln to development of American projects related to mobility till 2025.
It is known that the new venture in Georgia will be financed on a cost-sharing basis with a certain partner, whose name Hyundai has not yet disclosed, the total project budget will exceed $5.54 billion.
It is possible that it will be South Korean company SK On, which already has facilities in Georgia to produce traction batteries.
They are supplied for the needs of Volkswagen and Ford Motor, but knowledgeable sources told Reuters that electric cars Hyundai Ioniq 7 will be equipped with batteries manufactured by SK On.
The state of Georgia intends to attract about $1 billion more in investment to build facilities by Hyundai suppliers that will create the necessary local infrastructure for the Korean giant.