China the largest buyer of chipmaking machines as sales hit an all-time high

Despite US blocks to advanced technology nodes

Global sales of semiconductor fab equipment grew by 5 percent during 2022 to hit an all-time high, with China the largest buyer despite a fall in its investment amid the standoff with the US over access to chips and other technology.

The figures come from SEMI, the industry body for electronics manufacturing and supply chain, in a new Worldwide Semiconductor Equipment Market Statistics (WWSEMS) report.

According to the report, sales of chipmaking kit hit $107.6 billion last year, up from $102.6 billion in 2021, as semiconductor companies invested to add more capacity, despite the downturn that took hold in the latter half of last year as inflation gripped many economies.

"The record high for semiconductor manufacturing equipment sales in 2022 stems from the industry's drive to add the fab capacity required to support long-term growth and innovations in key end markets including high-performance computing and automotive," claimed SEMI president and CEO Ajit Manocha.

These results also reflect a desire by chipmakers in multiple regions to avoid any repetition of the supply chain issues that surfaced during the pandemic, he added. Many companies cut investment then, in response to falling orders, leading to shortages when demand picked up again.

China remained the largest market for semiconductor equipment despite seeing a 5 percent slowdown in investments compared with the previous year, according to SEMI.

This drop is likely caused by US moves to curtail China's ability to make advanced chips, which has now extended beyond American companies such as Applied Materials to include others such as Dutch photolithography giant ASML, as Washington has browbeaten allied nations including the Netherlands and Japan to join its sanctions.

China has already criticized Washington's actions, with news agency Reuters reporting that one of the country's commerce ministers expressed concerns about Japan's plans to put export curbs on various types of semiconductor manufacturing equipment in a meeting with the Japanese ambassador. The minister is said to have urged Japan to follow World Trade Organization rules in order to maintain stability of global supply chains.

Taiwan, the second largest market for chipmaking kit, recorded an increase of 8 percent to $26.8 billion, according to SEMI, while investments in Europe rose by an impressive 93 percent and the North America market saw a 38 percent increase. Sales to Japan grew by 7 percent, while the Rest of World increased by 34 percent. Korea bucked the trend by showing a fall of 14 percent to $21.5 billion.

According to Bloomberg, the US appears to be buying more of its chipmaking machinery from Taiwan, whose exports of semiconductor manufacturing kit to America rose by 42.6 percent in March when compared with a year earlier.

Global sales of wafer processing equipment were up 8 percent during 2022, while assembly and packaging equipment sales decreased 19 percent and total test equipment sales fell by 4 percent, SEMI reported. ®