The most advanced domestic chip foundry stated that its advanced process capacity has been fully booked by a specific domestic mobile phone company and is currently operating at full capacity. It is widely believed that this refers to a Shenzhen-based mobile phone company's self-developed 5G chip that is already in production and expected to be launched around the same time as Apple's iPhone 16 in September for sale.

Due to well-known reasons, this Shenzhen-based mobile phone company's mobile phone chips could no longer be manufactured by TSMC after September 15, 2020, resulting in a nearly three-year production halt of mobile phone chips. Production of domestic 5G chips resumed only last year.

However, the foundry manufacturer of this domestic 5G chip has never been confirmed, and it was not even mentioned as a 5G chip. The reason for this is well-known, but it does not prevent the industry from classifying it as a 5G chip. After all, actual test data shows that the download speed of mobile phones equipped with this chip has reached 5G levels.

Since its launch last year, this domestic 5G mobile phone has seen high sales. It is reported that the mobile phone sales of this company increased by more than 60% year-on-year in the second quarter of this year, regaining its position among the top five domestic mobile phone brands. This demonstrates that many consumers are willing to accept this domestic 5G mobile phone due to its domestic production reputation.

With the relaunch of its 5G mobile phones, the domestic mobile phone market landscape has undergone significant changes, primarily putting pressure on Apple. This 5G mobile phone was launched slightly earlier than the iPhone 15, which subsequently faced poor sales upon launch. As a result, the entire sales cycle of the iPhone 15 has seen price cuts, with the highest discount reaching 2,350 yuan during this year's 618 shopping festival, setting a new record for the fastest and highest price reduction in iPhone history.

Last year's domestic 5G mobile phones were a huge success, and consumers are eagerly awaiting the launch of a more powerful processor from this mobile phone company. It is widely believed that the recent news of the domestic chip foundry's entire advanced process capacity being fully booked may be related to this new domestic 5G chip, although some dispute this.

The demand for domestic advanced process chip capacity is extremely high. In addition to domestic 5G chips, domestic AI chips also require advanced process capacity. There have been reports that a domestic AI chip company had to reduce the design performance of its AI chips to meet TSMC's manufacturing requirements, highlighting the obstacles in outsourcing AI chip production to TSMC. In contrast, using domestic advanced processes is unaffected, which may prompt domestic AI chip companies to choose domestic chip foundries for production.

The development of domestic advanced processes requires not only the efforts of domestic chip foundries but also the support of domestic chip equipment manufacturers. Progress has been made in this regard, with a domestic etching machine company announcing efforts to promote the localization of 3-nanometer etching machines. Etching machines are among the fastest-developing chip equipment in China, essentially keeping pace with global chip manufacturing processes.

Currently, the development of domestic chip manufacturing processes primarily relies on lithography machines. Even the rumored 7-nanometer process currently uses immersion DUV lithography machines and multiple exposure techniques, leading to higher production costs. However, given the difficulties in obtaining TSMC's 7-nanometer and more advanced processes, having domestic advanced processes represents a significant breakthrough, freeing China from external dependencies.

It can be seen that the domestic chip industry is actively collaborating to enhance the development of advanced processes. The advancement of domestic chip processes will drive the further development of Chinese chips. As domestic chips generate more revenue by replacing imported chips, they can invest in more advanced technologies. A domestic chip equipment company has achieved over 50% growth in recent years, with substantial earnings providing strong support for the development of domestic chips.