Semiconductor sales globally surged nearly 15% in February compared to a year ago, reaching nearly $40 billion, the Semiconductor Industry Association reported on Monday.
The results could provide a bright spot for industries heavily dependent on chips for electronics, including parts used in autos that have faced shortages.
The February total was down by 1% from the previous month, however. In the Americas, sales in February declined more, nearly 6% compared to January.
Sales into China saw the largest year-to-year growth of any region, up by 19%, but mainly because sales were down substantially last year with the pandemic.
Other markets saw substantial increases in February year-over-year, with an increase in Asia Pacific by 18%, and nearly 10% in the Americas. Japan was up by 7% and Europe was up by nearly 7%.
The SIA last week released a study with Boston Consulting Group that continued SIA’s strong push for government support for bolstering the strength of the domestic semiconductor supply chain. Shortages of auto chips in recent months have been acute and some analysts believe the shortages will continue throughout much of 2021.
SIA is sponsoring a webinar on the supply topic on Wednesday at 3 ET.
President Biden’s $2.2 trillion infrastructure proposal, released last week, includes $50 billion for bolstering the domestic chip supply chain. In addition, Biden included more than $500 billion in for research and development initiatives affecting chip and electronics industries and the communications sector.
SIA Board Chairman Bob Bruggeworth, also CEO of Qorvo said U.S. investments in semiconductor manufacturing and research “will help address vulnerabilities in the supply chain and ensure more of the essential chips our country needs are produced domestically.”
The SIA/Boston report found that about 75% of global semiconductor capacity is concentrated in China and East Asia, areas exposed to seismic activity and geopolitical tensions. Fully 100% of advanced chip manufacturing (for chips below 10 nm) is in Taiwan (92%) and South Korea (8%).
If there were a complete shutdown of Taiwanese foundries, it would take three years and a $350 billion investment to build enough capacity in the rest of world to replace what those foundries produce, the study found.
The study also noted that all countries around the globe are currently interdependent in the integrated supply chain which relies on free trade to move materials, equipment, Ip and products to find the optimal location for each different type of chip design and production. Semiconductors are the fourth most traded product globally after crude oil, refined oil and cars.
In a hypothetical model, the study found that a fully self-sufficient local supply chain in each region to meet the current needs of chip consumption would have required $1 trillion in upfront investment, leading to a 35% to 65% increase in chip prices and higher costs for electronic devices for consumers and industries.