The semiconductor industry in South Korea has been hit again recently.
Frome：www.pulaya.com
Date：2021-03-31
The semiconductor industry in South Korea has been hit again recently.
The latest data shows that South Korea‘s chip production fell for the fourth consecutive month in November last year, with a year-on-year decline of 15%, marking the largest decline since 2009. According to an analysis by UBS, chip inventory is at its highest level in over a decade. From “chip shortage“ to “destocking“, in just two years, the global semiconductor industry has undergone a “sudden change“.
As the semiconductor industry enters a cold winter, there has been a significant decline in corporate performance. Samsung Electronics saw a 34.2% month on month decline in sales of Dynamic Random Access Memory (DRAM) in the third quarter of last year. SK Hynix‘s sales decreased by 25.3% month on month. In addition, memory chip giant Meguiar plans to lay off employees, Intel cuts costs, and foundries would rather default than “cut orders“. The chill sweeping the consumer electronics market quickly spreads to the chip market, turning semiconductor manufacturers from “not earning enough“ to “not selling enough“.
As the host country of Samsung Electronics and SK Hynix, the downturn in the semiconductor industry has cast a shadow over the Korean economy. In November 2022, South Korea‘s overall industrial output shrank by 3.7% compared to the same period last year, marking the largest decline in two years.
Semiconductors are South Korea‘s largest export commodity, and the South Korean President once compared them to the staple food “rice“ in South Korea, demonstrating their importance to the Korean economy. The South Korean Ministry of Finance stated in a statement that the weak global demand for chips has made the outlook for the South Korean economy even more uncertain. The South Korean President has requested the Ministry of Finance to actively consider expanding tax incentives for the chip industry. However, South Korean media predict that the “winter of the semiconductor industry“ in South Korea will be longer than expected.
In addition to being crucial to the domestic economy, South Korea‘s semiconductor industry is also seen as the “canary in the coal mines“ of the world economy. The decline in chip production and export data indicates that as the global economy slows down, the market‘s demand for technology components has further cooled. The World Semiconductor Trade Organization predicts that the global semiconductor market size will decrease by 4.1% year-on-year in 2023, reaching a historical freezing point.
The latest data shows that South Korea‘s chip production fell for the fourth consecutive month in November last year, with a year-on-year decline of 15%, marking the largest decline since 2009. According to an analysis by UBS, chip inventory is at its highest level in over a decade. From “chip shortage“ to “destocking“, in just two years, the global semiconductor industry has undergone a “sudden change“.
As the semiconductor industry enters a cold winter, there has been a significant decline in corporate performance. Samsung Electronics saw a 34.2% month on month decline in sales of Dynamic Random Access Memory (DRAM) in the third quarter of last year. SK Hynix‘s sales decreased by 25.3% month on month. In addition, memory chip giant Meguiar plans to lay off employees, Intel cuts costs, and foundries would rather default than “cut orders“. The chill sweeping the consumer electronics market quickly spreads to the chip market, turning semiconductor manufacturers from “not earning enough“ to “not selling enough“.
As the host country of Samsung Electronics and SK Hynix, the downturn in the semiconductor industry has cast a shadow over the Korean economy. In November 2022, South Korea‘s overall industrial output shrank by 3.7% compared to the same period last year, marking the largest decline in two years.
Semiconductors are South Korea‘s largest export commodity, and the South Korean President once compared them to the staple food “rice“ in South Korea, demonstrating their importance to the Korean economy. The South Korean Ministry of Finance stated in a statement that the weak global demand for chips has made the outlook for the South Korean economy even more uncertain. The South Korean President has requested the Ministry of Finance to actively consider expanding tax incentives for the chip industry. However, South Korean media predict that the “winter of the semiconductor industry“ in South Korea will be longer than expected.
In addition to being crucial to the domestic economy, South Korea‘s semiconductor industry is also seen as the “canary in the coal mines“ of the world economy. The decline in chip production and export data indicates that as the global economy slows down, the market‘s demand for technology components has further cooled. The World Semiconductor Trade Organization predicts that the global semiconductor market size will decrease by 4.1% year-on-year in 2023, reaching a historical freezing point.
