July 11, 2025 /SemiMedia/ — A spike in China’s demand for mature-node semiconductors, driven by state-led “trade-in” subsidies and rising domestic chip production, is fueling record-high utilization rates at Korean 8-inch foundries such as DB HiTek and SK Key Foundry.

Amid ongoing U.S.-China tech tensions, Chinese customers have increasingly shifted orders to Korean fabs known for their expertise in legacy process nodes. DB HiTek has reported a surge in Chinese demand since early 2025, pushing its Bucheon fab utilization beyond 100%. The company’s overall 8-inch line utilization rose to over 85% in Q1, up sharply from around 74% at the end of 2024.

In response, DB HiTek upgraded its Shanghai office into a local legal entity in March 2025, signaling deeper China market engagement. The company reported KRW 2.76 trillion in total revenue in Q1, with an estimated KRW 1.7 trillion coming from Chinese customers.

SK Key Foundry, which primarily serves SK hynix’s AI memory chip needs, has also seen Chinese orders rise sharply in the first half of 2025. Its fab utilization topped 80%, with China potentially accounting for up to 30% of its total revenue.

Much of the demand is tied to China's massive government-backed push to upgrade electronics and industrial systems through its RMB 300 billion “trade-in” subsidy program. Key semiconductor segments such as power management ICs, display driver ICs, and microcontrollers used in home appliances and vehicles have seen a notable increase in orders.

As Chinese foundries near full capacity, many local firms are turning to Korea for additional wafer supply. This shift is further accelerated by U.S. export controls restricting China's access to advanced semiconductor manufacturing tools, compelling domestic firms to double down on mature node production and diversify outsourcing options.

The surge in Chinese demand is reshaping the foundry landscape, with Korean fabs emerging as key partners amid evolving global semiconductor supply dynamics.