According to media reports, HIS Markit, a professional information service, estimates that the shortage of automotive chips will not be alleviated until the second half of next year, when the delivery time of microcontroller (MCU) and single-chip system (SoCs) will be the key.
However, HIS Markit said that at present, there is no shortage of automotive chips for cars with high demand in the United States, such as pick-up trucks, and the shortage has not endangered the overall car market.
Why are automotive chips out of stock?
On the supply side, affected by the epidemic in the first half of this year, expectations for both the automobile industry and the semiconductor industry are actually not optimistic. Pessimistic forecasts for the first half of the year have to some extent curbed production plans for automotive chip production in the second half of the year. On the other hand, the spread of the global epidemic, the chip and the upstream of the chip are affected, the upstream 8-inch wafer capacity of the MCU chip is tight, and the recent suspension of production at the chip assembly plant in Southeast Asia due to the epidemic, as well as the large-scale strike of the Italian chip giant ST (Italian and French Semiconductor) have further aggravated the shortage of MCU chip supply.
Recently, Renesa Electronics, NXP and other key automotive chip manufacturers have said to raise product prices, IGBT, MOSFET, PMIC and other typical power semiconductors and MCU have increased prices due to lack of production capacity. According to media reports, the main reason affecting the suspension of production of North and South Volkswagen is the insufficient supply of high-end chips.
On the demand side, China's auto industry continues to recover and the market performance exceeds expectations. According to the China Automobile Association, China's car sales have achieved double-digit year-on-year growth for seven consecutive months as of November, passenger car sales have grown faster than expected, and commercial vehicle production and sales have maintained a high growth rate. Among them, sales of new energy vehicles were 200000, an increase of 104.9% over the same period last year.
The development of electronic and intelligent automobile has also further increased the demand for bicycles of automotive chips. Compared with traditional fuel vehicles, hybrid or all-electric vehicles need more vehicle chips to be equipped with advanced driving assistance system (ADAS), infotainment system, digital dashboard, head-up display (HUD), safety and other high-end functions.
In addition, under the situation of tight production capacity of the overall semiconductor industry, consumer electronics ushered in the peak season, further grabbing chip production capacity. According to HIS Markit estimates, in addition to the car market, other industries will increase demand for semiconductors at a faster-than-expected rate in the fourth quarter of this year. In addition to Samsung and Apple phone manufacturers have launched 5G phones to increase semiconductor capacity demand, the launch of the new generation game console Play Station 5 and Xbox Series X consumes the remaining available front-end fab capacity.
When will it return to normal?
Compared with other automotive chips, the increase in delivery time of MCU and SoCs is very important, the main reason is that MCU has its own architecture and is different from memory, standard logic IC and power supply IC, which has many qualified suppliers, so it is difficult to change suppliers easily.
At present, there is no long-term out-of-stock crisis in the auto market, the real risk of the long-term supply crisis is that if the first-tier suppliers and car factories continue to extend the delivery time of vehicle chips, but the order quantity exceeds the market demand will cause panic, overbooking (Overbooking) will cause suppliers to misunderstand the actual demand and aggravate the imbalance between supply and demand. 2010 is a bloody case. A prolonged blackout crisis could lead to increased supply shortages in the first half of 2021, particularly MCU, which means the car market needs inventory adjustments in the second half of the year to dilute excess chip stocks.
The opportunity of self-sufficient space for automotive chips to replace domestic products is emerging.
Great Wall Securities analysis pointed out that the domestic automotive chip market is basically monopolized by foreign enterprises, and the self-sufficiency rate of China's automotive chips is less than 10%. Only a small number of domestic enterprises, such as Zhaoyi Innovation, BYD and so on, can produce automotive chips. Zhaoyi Innovation is the 32 leading enterprise of automotive MCU products in China, while BYD has entered the field of MCU since 2007. The shortage of automotive chips may last for half a year, and it is expected that there will still be some pressure on the supply of automotive chips in the first half of 2021.
In the case of mismatch between supply and demand of automotive chips, domestic substitution has emerged. According to industry media reports, industry insiders said that affected by the epidemic, manufacturers that originally used imported IGBT also gradually introduced domestic suppliers such as Starr Semiconductor and BYD Semiconductor because of insufficient supply.
Haitong Securities analysis points out that there are two types of investment opportunities in the automotive power semiconductor industry:
1) SiC trend in the global market, it is recommended to pay attention to Cree (global substrate market share more than 60%) and ST (supplier of Tesla SiC MOS). Domestic enterprises include Shandong Tianyue, Tianke Heda and Tyco Tianrun.
2) domestic market imports replace, Si IGBT modules, IGBT and MOS chips. At present, local enterprises IGBT modules have begun to enter the car regulation system, IGBT and MOS chips have gradually begun to certify vehicle regulations, and it is expected to achieve a breakthrough in mass production within 3-5 years. It is recommended to pay attention to Starr semiconductors, Silan Micro, Wentai Technology, Huahong Semiconductor, and related domestic companies as well as Ningbo Daxin, etc.
