China promotes localization of automotive chip supply chain, and many international companies seek cooperation

The Chinese government encourages domestic automakers to increase the proportion of domestic chips used to 25% by 2025. At the same time, the government also supports foreign companies to localize production in China. This has led many major automotive chip suppliers, such as STMicroelectronics, Infineon, NXP and Renesas, to actively negotiate cooperation with local Chinese wafer fabs such as SMIC and HHGrace in recent years.