China aims to control over 60% of the world’s new legacy chip production capacity in the next decade. These chips, essential for everyday products like cars, smartphones, and medical devices, are less advanced than those used in AI but are crucial for mass-market applications. The U.S. Trade Representative (USTR) has initiated a year-long investigation into China’s practices, prompted by concerns over national security and the potential stifling of U.S. domestic semiconductor growth. Commerce Secretary Gina Raimondo expressed alarm that two-thirds of U.S. products using chips contain Chinese legacy chips, with half of U.S. companies unaware of their chips’ origins, including some in the defense sector. The probe will examine China’s manufacturing of foundational semiconductors and their integration into critical industries like defense, automotive, and telecommunications. Additionally, it will assess the impact on silicon carbide substrates, vital for semiconductor fabrication.
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