GTA Semiconductor, China's Automotive Chip Maker Company, Completes Funding Of More Than IDR 27.43 Trillion

GTA Semiconductor gets a capital injection. (photo: twitter @marketunwinded)

JAKARTA - China's automotive chipmaker, GTA Semiconductor, recently completed a funding round largely funded by the government worth more than US$1.8 billion (Rp27.3 trillion), as reported by the State-backed Securities Times on Wednesday, September 6. The move is seen as a clear signal to the domestic chip manufacturing industry that Beijing is still willing to invest in it.

With this capital injection, Shanghai-based GTA Semiconductor, one of China's largest automakers, according to production, has raised more than US$2.7 billion in less than two years, mostly in the form of government funding, according to the Securities Times.

This amount, which some Chinese media described as one of the biggest domestic funding rounds of the year, comes as China prepares to launch a new state-backed investment fund with the aim of raising around $40 billion for the semiconductor sector, as reported exclusively by Reuters on Tuesday, September 5.

Reuters could not confirm whether the latest funding by automakers was linked to these new funds or not.

GTA Semiconductor has been backed by state-owned venture capital firms such as Shanghai-based Spinnotec, which first announced a $1.8 billion funding round on Monday, September 4 without specifying the entity involved.

The large number collected by GTA Semiconductor demonstrates Beijing's commitment to supporting domestic manufacturers in its continued efforts to reduce its dependence on foreign chip production.

While most cars use less technologically sophisticated chips, the rate of replacement of these chips by domestic manufacturers in China is still below 10%, making it a further investment target in the future, the country says.