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Reds on the beds: Putin's war sparks Chinese chip boom, starting with electric blankets

As energy prices rise, so does demand for the kind of low-end chips China cranks out

Here's an odd side effect of Russia's illegal invasion of Ukraine: a small boom in exports of Chinese electric blankets to Europe.

Chinese analyst and consultancy outfit JW Insights (Ijiwei) reported the jump in sales from "70,000 to 80,000 compared to about 30,000 in previous years." Plenty of those blankets contain locally made chips to monitor and/or regulate temperatures. Ijiwei said posh models may even include Bluetooth or other tech, creating further opportunities for Chinese chipmakers.

The consultancy said the value of electric blanket exports from China between January and July reached $33.4 million – year-on-year growth of 97 percent that vastly exceeded other classes of consumer electronics.

That growth is welcome, because the consumer tech market is having a very quiet year – as shown by the nasty dip in PC shipments we reported yesterday.

But electric blankets alone won't make much of a difference to consumer tech manufacturers or their component suppliers. Ijiwei cited a local manufacturer's estimate that chips for the warming devices might be a $14 million market if shipments surge all the way to 100 million units.

But the reason for the current spike in sales represents a bigger trend: electric blanket sales are booming because energy prices have risen sharply in Europe thanks to Russia's illegal invasion of Ukraine – and alleged sabotage of pipelines – crimping the supply of the natural gas European nations use to produce electricity.

Electric blankets are cheaper to run than heaters, hence the sales spike.

Ijiwei's take on Europe's energy shortages and price rises is that they have created demand for photovoltaic and wind power tech, plus more chips to manage stored energy.

The firm therefore suggests the electric blanket bloom is a harbinger of other growth opportunities for Chinese chipmakers to chase.

And the good news, for China, is that the kind of silicon that's needed for an electric blanket or energy applications is low-end stuff that local firms can already make and won't be prevented from pursuing, even as the USA tries to block Beijing's access to more advanced semiconductors. ®

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