[Introduction: The lack of chips is a major challenge that the world has encountered since the outbreak of the epidemic. The United States, Europe, India and other countries have released high subsidies to encourage relevant chip companies to build factories locally. But recently, the once hottest MCU suddenly saw a halving price. What is the price trend of chip in the future and what impact will it have on the global automotive industry? It is worth our attention. 】
Written by | Zhang Dachuan, Editor | Kang Qiao
semiconductor chip , which once rose at one time, has recently seen a turning point. According to media reports, the storm of cutting orders and price cuts in semiconductor chips is becoming more and more serious, and even the quotation of MCU, which was previously in short supply, has begun to see a significant price cut. There are also reports that the prices of ex-factory products of the top five MCU factories in the world have been cut in half. As for Taiwan's leading chip foundry industry, TSMC has even lowered its revenue target. The reason behind this is that TSMC's top three customers - Apple , AMD and Nvidia have all lowered their orders.
Why did the once inconspicuous car MCU suddenly shortage?
In fact, what car companies generally lacked before was MCU chips with low manufacturing processes. On the contrary, the high-process chip production capacity of , which is mastered by a few chip foundry companies such as Samsung , TSMC, etc., is very sufficient. In fact, the previous shortage of automotive chips was the result of the joint action of multiple factors: the unexpected COVID-19 outbreak of the new crown epidemic has torn a hole in the shortage of chips. The production capacity of most of the world's automotive chips is located in Southeast Asia, Japan, South Korea and Taiwan. The 2020 COVID-19 pandemic has caused major chip production bases such as Southeast Asia to be locked down for a time, and international logistics has been interrupted for a while, which has led to great problems in the supply of chips. Of course, another more important factor is that the number of local chip foundries in China is seriously insufficient, and there are no international giants in terms of automotive-grade chips.
Mobile chip competition for production capacity further upgrade the chip short trend. Before and after the United States announced that it would include Huawei on its entity list, Huawei had already had a premonition of the huge dilemma it would face. During that time, Huawei desperately purchased and stockpiled chips around the world. For many chip companies, consumer electronics chips like mobile phones have greater profits and require lower requirements than automotive grades. In the face of huge demand for consumer electronic chips, chip foundry companies will be more willing to leave production capacity to consumer electronic chips.
In addition, the intelligent upgrade of automobiles has also played a role in promoting. At present, with the popularization of intelligent connected technology in the automotive industry, the demand for chips for complete vehicles has increased significantly. This is not only the high computing power chips required for smart cockpits and autonomous driving, but also a large number of electronic control systems on board, and basically each system needs a chip.
As the chip supply and demand relationship changes, chip prices have risen, so many middlemen have begun to hoard chips. This situation of rare goods being accustomed to making chip supply globally difficult to find. There were even rumors before that some car companies were looking to purchase ESP chips on the black market for thousands of yuan to ensure the delivery of models. Another situation that must be mentioned is that in 2020, in order to hedge the impact of the epidemic, countries including the United States released huge quantitative easing policies. Mints are printing money at full speed, and the government actively issues money to offset the impact of the epidemic on the economy, which has led many consumers to choose to buy real estate, cars and other luxury accessories to fight the dilution of currency by inflation, which has greatly increased the demand for cars. Why is there no shortage of
chip?
According to common sense, the situation of hard-to-find single-core has lasted for nearly three years, and the biggest reason for the halving of MCU prices this time can be attributed to the following factors: the demand for
mobile phones has dropped sharply. Affected by the epidemic, the replacement cycle of mobile phones for domestic users has increased significantly. According to third-party research firm Counterpoint, the average replacement cycle of Chinese users has been extended from 25 months to 31 months. Affected by this, some analyst also said that major Chinese Android mobile phone brands have cut orders by about 170 million this year, accounting for 20% of the original 2022 shipment plan, and this number may further decline.
car sales are also not optimistic. Considering that the domestic car ownership is already large, in the face of the economic downturn brought about by the epidemic, many consumers will postpone their car purchases. Declining car sales will inevitably lead to a decrease in demand for chips. Under such circumstances, the supply and demand contradiction between automotive chip MCUs can be alleviated in the short term.
production capacity continues to expand. Major chip companies around the world are expanding their production capacity under high subsidies from various governments. Taking the United States as an example, whether it is the Intel , or TSMC and Samsung, under the high subsidies of the US government, they are about to build factories in the United States to expand their production capacity. As for traditional chip production countries such as South Korea and Japan, expanding chip production capacity is a green light and there are no obstacles. Although it takes a certain amount of time to expand chip production capacity, it is not only unexpected but also reasonable that the MCU price will be halved when the supply side continues to expand, but the demand side may be sluggish in the short term.
But in the long run, with the improvement of the degree of intelligence of automobiles, unless large computing power chips and electrical architectures in the body domain are used, the demand for bicycle chips will still be in an increasing process. Designing a brand new electrical architecture often affects the whole body. Therefore, in the future, with the recovery of the domestic and even the global economy of , mobile phone and car sales will also enter the upward channel again. If the production expansion speed of chip manufacturers cannot keep up with demand, new problems will arise in the future.
How do Chinese chip companies respond?
Current chip demand declines, largely due to poor expectations of economic outlook.
For companies that are investing in the domestic automotive-grade chip field, the reduction in chip prices is undoubtedly bad news. This will not only greatly reduce the profit margins of these companies, but will also affect their confidence in investing resources in related fields for research and development. It happened before the domestic automobile industry. Many domestic companies are vigorously working on anti-lock ABS technology. When the related products were released, Bosch suddenly announced a significant reduction in the price of ABS, so that those companies that had originally invested a lot of R&D resources in this field could not compete with parts giants like Bosch.
Therefore, for MCU automotive grade automotive chips, the country and the major domestic independent brand car companies need to provide certain support for them. For our independent brand car companies, if one day we have the capital to compete with Tesla , then our independent brand car companies are likely to be included in the entity list like Huawei, like Huawei, on false charges by the US government, and then there is no way to obtain automotive-grade chips from multinational parts companies. But at the same time, we cannot rush to invest. For many automotive grade MCUs, most of them are chips with processes such as 56nm and 28nm, and the process difficulty is not very high. However, domestic companies have not been favored by vehicle manufacturers and have been included in the list of suppliers of vehicle manufacturers. Moreover, the prices of these chips are not high. If localities only vigorously develop these low-process chips, their business prospects will not be clever. This is incomparable to chips below 7nm, especially 3nm and 2nm, which are currently urgently needed to be researched in China.
Comments
chip industry, although it is China's shortcomings, should also avoid rushing investment, resulting in waste of social resources. Chips are an area that requires a lot of capital investment and also require a lot of accumulation of technology and experience. Short-term price fluctuations are difficult to change the long-term positive trend. Whether it is automotive-grade MCUs with relatively low processes or high-process main control AI chips, domestic companies still have great potential as long as they can endure loneliness.
(This article is original by "Heyan Yueche" and may not be reproduced without authorization)
