Tech war: Chinese manufacturers brace for the impact of Japan’s semiconductor export curbs
- A number of Chinese listed companies have addressed investor concerns by saying that Japan’s new export curbs will only have a limited impact on their operations
- Chinese firms account for more than half the global display panel production capacity, but core technologies to make panels are mostly controlled by Japanese suppliers
Chinese companies are scrambling to seek local substitutes to cut reliance on Japanese suppliers as they brace for the impact of Tokyo’s export curbs on semiconductor equipment and materials, according to corporate statements and analysts.
Under tightened export restrictions unveiled by Japan’s Ministry of Economy, Trade and Industry (METI), Japanese suppliers of 23 types of semiconductor equipment are required to obtain prior export licenses to sell to China starting from July. This follows an agreement by the US, Japan and the Netherlands to limit the export of advanced chip-making equipment to China.
As the Chinese government urges Tokyo to revoke the curbs, a number of Chinese listed companies have addressed investor concerns by saying that the measures will have a limited impact on their operations, and that they are enhancing efforts to seek domestic substitutes, according to published corporate statements.
TCL Technology, the world’s second-largest television set maker by sales, has told investors that the company is rapidly increasing its domestic supply chain to ensure stable operations, adding that it will closely monitor changes in the restrictions and make timely adjustments.
BOE Technology Group, China’s top display panel manufacturer, said although it sees little impact from the restrictions, the company has redoubled efforts to ensure supply chain security and is promoting the localisation of raw materials to minimise risks. The Shenzhen-listed company said it has already supported dozens of upstream material and equipment partners in their efforts to develop local alternatives.
Another display maker, Shenzhen-listed Visionox, also told investors that it will “enhance innovation” in the upstream and downstream industrial supply chain, and promote localisation to ensure “a secure and controllable supply chain”.
Chinese companies account for more than half the global display panel production capacity, but core technologies and equipment needed to make panels – such as vacuum evaporation machines – are mostly controlled by Japanese companies.