The global semiconductor sector is witnessing a dramatic shift as Mainland China continues its rapid expansion. From a modest 6% in 2010, China´s share of global semiconductor equipment sales climbed to 38% by 2024. This growth contrasts with falling market shares in traditional hubs such as Taiwan, Korea, and Japan, according to McKinsey. In response to the shifting landscape, Taiwan is constructing new semiconductor fabrication plants in the United States and Europe, diversifying beyond its regional base. Meanwhile, Japan´s industry growth remains sluggish despite TSMC´s highly anticipated Kumamoto fab. The US, Europe, the Middle East, and Africa have managed to sustain steady market shares.
Much of the global industry´s growth from 2010 to 2019 was fueled by globalization, benefiting Chinese semiconductor firms with an impressive annual growth rate of about 21%. However, from 2019 to 2023, growth slowed to 9-10% due to US sanctions on Huawei, which directly impacted its chips division HiSilicon. Despite these challenges, China´s domestic semiconductor momentum remains robust, with experts forecasting sustained growth. Recent US tariffs have further motivated China´s drive for semiconductor self-sufficiency, intensifying efforts to localize technology and supply chains.
China´s dominant role is further amplified by its leadership in industries such as electric vehicles (EVs) and commercial drones, where it is a primary driver of global semiconductor demand. In 2023, China accounted for 60% of worldwide new EV registrations, underlining its influence on related semiconductor requirements. Political pressures and technological rivalry have accelerated China´s ambition to create a self-reliant semiconductor infrastructure. The country is currently testing a domestic extreme ultraviolet (EUV) lithography tool using laser-induced discharge plasma technology at Huawei´s Dongguan facility. Trial production is slated for the third quarter of 2025, with mass manufacturing targeted for 2026, marking a critical step toward reducing dependence on foreign technology and asserting China as a global semiconductor powerhouse.
