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China Hoards Used Chipmaking Machines To Combat Shortage

Chinese semiconductor makers are hoarding used chipmaking machines in a rush to develop homegrown products amid global shortages.

As demand for chips skyrockets worldwide, even older, out-of-date equipment is selling out quickly, reports Nikkei Asia.

Used equipment dealers confirm prices have risen by 20 per cent from last year and these older-generation machines are not restricted by US sanctions on China, meaning Chinese players can be unlimited access.

Sources told the publication 20-30 year-old machines which would have been ‘useless’ several years ago are now operating on the production line.

One source told Nikkei Asia prices are comparable to the trends seen after the 2008 financial crisis.

“Nearly 90% of used machines appear to be headed to China,” said a source at Mitsubishi UFJ Lease & Finance.

“I’ve heard that some Chinese makers are just buying up machines even if they don’t use them right away,” another source said.

The pandemic-driven chip shortage is affecting TV and PC display manufacturers and power management chips for white goods.

The COVID-19 lockdown has seen people cooped up at home and more are turning to PC games, driving demand for semiconductors.

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