China asks carmakers to use up to 25% local chips by 2025

TAIPEI/BEIJING — China is urging the country’s top automakers to source up to a quarter of their chips locally by 2025 as the world’s biggest car market looks to build a competitive and self-reliant semiconductor supply chain amid escalating tensions with the U.S.

The Chinese Ministry of Industry and Information Technology has asked automakers including SAIC Motor, BYD, Dongfeng Motor, GAC Motor and FAW Group to increase their local procurement of automotive-related chips to 20% or 25% by next year, according to sources briefed on the matter, with an eventual goal of increasing the ratio well beyond the initial target.