In response to Japan’s impending export restrictions on semiconductor equipment and materials, Chinese display companies are ramping up efforts to increase their reliance on domestic suppliers. The restrictions, introduced by Japan’s Ministry of Economy, Trade and Industry, mandate Japanese suppliers of 23 types of semiconductor equipment to obtain prior export licenses to sell to China from July.
This move by Japan, the US, and the Netherlands aims to limit China’s access to advanced chip-making equipment, placing Chinese companies in a challenging position. These companies, which make up more than half of the global display panel production capacity, are largely dependent on core technologies and equipment, like vacuum evaporation machines, controlled by Japanese suppliers.
According to a report in the South China Morning Post, Chinese leading display companies, TCL and BOE, are attempting to mitigate the impact of these restrictions. In an attempt to reassure investors. TCL has officially declared its commitment to closely monitoring changes in the restrictions and making appropriate adjustments. BOE is said to redoubling its efforts to maintain supply chain security, with a strong focus on localizing raw materials. The firm said it has been supporting many of its upstream material and equipment partners to develop local alternatives.
TCL and BOE are not alone, Visionox has communicated its intent to enhance innovation in the supply chain and promote localisation to ensure a secure and controllable supply chain. PNC Technology Group has been actively fostering local suppliers to replace imports from Japan and South Korea, aiming to continuously increase the market share of domestic suppliers.It all aligns with China’s broader goal of achieving self-reliance in the sector. However, the extent to which these companies can successfully offset the effects of these export restrictions with domestic solutions remains to be seen.
