Shulou(Shulou.com)11/24 Report--

CTOnews.com, November 13, according to Taiwan's Economic Daily, wafer foundry mature process manufacturers are facing a 60% defense battle for capacity utilization.

It is said that in order to save the capacity utilization rate, manufacturers such as United Power, World Advanced and LSMC have significantly reduced their contract manufacturing quotations in the first quarter of next year by double digits, and the number of project customers has dropped by as much as 15% to 20%, trying to "trade price for quantity." some manufacturers have even killed red eyes.

Industry insiders revealed that at present, except for TSMC's still strong quotation, almost no other manufacturers have been spared.

According to Tu Yuan Pexels, consumer customer demand is low, while manufacturers specializing in 8-inch foundry mature processes are the most affected, such as power management IC, drive IC and micro-controller (MCU) and other chip inventory level still maintain a high level, and some products have been converted to 12 inches, so that 8-inch wafer foundry capacity utilization has recently been maintained at a low water level.

People in the industry pointed out that TSMC is backed by advanced processes and can be sold together with mature processes. Coupled with the fact that the previous OEM quotations for mature processes have not risen too high, customers can still accept TSMC's strategy. Therefore, TSMC's mature process hardly needs to worry.

As for UMC, the company expects capacity utilization this quarter to fall to 60% 63% from 67% in the previous quarter, a single quarterly low in recent years; due to the continuous revision of capacity utilization, gross profit margin will fall to 3133% from 35.9% in the previous quarter, returning to the level at the beginning of the 2021 outbreak.

In this regard, UMC responded that: 8 inches will indeed have a significant decline, but 12 inches has not been adjusted. In fact, UMC's revenue has continued to decline this year, totaling 186.77 billion New Taiwan dollars (CTOnews.com Note: currently about 42.21 billion yuan) in the first ten months of this year, down about 20.60 percent from the same period last year.

According to the supply chain, in order to consolidate customers' willingness to place orders, UMC offered 5% price concessions to major customers earlier this quarter, and is expected to expand the price reduction to double digits, considering that demand remains flat in the first quarter of next year.

On the advanced side of the world, the supply chain revealed that the price dropped by 5% in the second half of the year, and customers with a large number of films can even get a 10% discount, which is expected to be reduced by single digits to double digits in the first quarter of next year.

Ligan was also deeply affected, falling into a loss in the third quarter, with capacity utilization only around 60%. It is said that Liji will also offer price reduction measures to improve capacity utilization.

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