2021 is about to pass. If you want to choose a key word for the semiconductor industry this year, it must be a lack of cores. Increasing demand has allowed the capacity utilization rates of major 8-inch and 12-inch wafer foundries to approach 100%. In order to alleviate the chip shortage in 2021, many fabs have announced expansion plans. It is expected that there will be 12 new foundries worldwide in 2022. Among the most concerned, TSMC will add three fabs in Taiwan, Japan, and the United States; Samsung will add two fabs in South Korea and the United States; SMIC will add three new fabs in the mainland.
Under this background, when the lack of core can be solved has become a problem that everyone is concerned about.
When will the lack of cores be resolved, and what do all parties say?
The prediction of the out-of-stock by the chip designer continues until the second half of 2022. In September of this year, AMD CEO Su Zifeng said that global chips will gradually ease in the second half of 2022, but the first half of the year may still be tight. And Qualcomm CEO Cristiano Amon said in October that the supply chain can gradually get rid of the crisis of core shortage in early 2022. Digitimes also predicts that Apple’s shipment restrictions due to lack of cores will be eased in February 2022.
The predictions given by chip manufacturers are relatively conservative. GF Semiconductor said that GF’s production capacity before 2023 has been booked out; Intel also believes that the chip supply problem will not improve until 2023; TSMC also said that its production capacity is tight. The stretch will last until next year. The conservative predictions of chip manufacturers are mostly due to the unpredictability of demand. As Zhang Zhongmou said, the root cause of the current round of core shortage is that the demand side underestimated the demand for chips, not the production capacity of the manufacturer.
The efforts of the automotive industry as a whole from upstream to downstream have allowed the automotive industry, which has the most serious shortage of cores, to see the hope of releasing its production capacity. Many domestic and foreign auto factories, such as Ford, GM, Geely, etc., announced their entry into the semiconductor industry and the development of self-developed chips. At the same time, the epidemic in Malaysia, the main production site of many major automotive semiconductor manufacturers, has eased, and the production capacity of automotive semiconductor manufacturers such as Infineon and STMicroelectronics has been eased. In this regard, Cui Dongshu, Joint Secretary-General of the National Passenger Car Market Information, said that due to the opaque supply of chips, it is expected that chip supply will still be under certain pressure by the end of 2021. From a long-term perspective, due to the continued inability of inventory in the fourth quarter to make up, it will be difficult to impulse at the end of the year. Some demand is expected to shift to 2022.
Semiconductor shortage is the lack of production capacity, or is there someone in the middle of stockpiling?
According to TrendForce's consulting data, the CAGR of 12-inch wafer production capacity from 2019 to 2023 is 12% in 5 years. In contrast, the 5-year CAGR for 8-inch wafer production capacity is only 3%. According to data from Semi and the annual report, the global 8-inch wafer market is mainly composed of 7 types of devices-of which, MOS logic devices account for about 25%, analog devices account for about 22%, optoelectronic devices account for about 16%, and power discrete devices account for about 15%. %, micro-logic devices accounted for about 9%, storage devices accounted for about 8%, and sensors accounted for about 5%. In the past, 8-inch wafer foundry was regarded as an insufficiently advanced production line in the industry. However, the rebound in terminal markets such as mobile phones and new energy vehicles has led to a tight supply of 8-inch wafers.
There is a view that it is the stockpile of middlemen that caused the core shortage of semiconductors, but in fact, this view is too absolute. In this regard, a general representative of the semiconductor industry explained that "From the perspective of the types of products that are out of stock on the market, the shortage of goods this year is not only concentrated in a certain category, but all types of semiconductors are out of stock. . If a single type of product is out of stock, it can still be understood as the periodicity of semiconductors; but in the face of a full line of products out of stock, the root cause is difficult to explain in terms of stockpiling."
However, this agent also said that the hoarding behavior is not completely non-existent. It can be seen from the successive releases of a number of previously hard-to-find MCUs on the market that semiconductor traders have a high probability of speculation. However, the government has increased control over this behavior. In September this year, the State Administration of Market Supervision imposed fines on three auto chip distributors for driving up the price of auto chips, and said it would pay close attention to the price order in the chip field, and crack down on hoarding and escalation. Illegal acts such as prices. But the relationship between stocking and stock-out is that stock-outs allow middlemen to see the temptation of stock-stocking, rather than stock-stocking that leads to stock-outs.
Panic stockpiling is actually one of the important reasons that aggravate the shortage of the supply chain. In the ICT market, the inventory level of terminal assembly plants is significantly higher than before. In the past operation model, most of the inventory was borne by agents and agents, but it was affected by shortages in 2021. Terminal assemblers were worried about insufficient control of the material sources, so they quickly pulled the goods into their own warehouses. According to market estimates, the inventory turnover days of assembly plants are approximately 2 months longer than normal. The hoarders in the market are not only the traders of semiconductors, but also the demanders of semiconductors. This can also be confirmed by the downward trend in DRAM market prices. IC Insights data shows that the average selling price of DRAM in September has fallen by 3%, and this is precisely because PC and server manufacturers stockpiled a large amount of DRAM in the first half of the year, and production in the second half of the year has entered the inventory consumption stage. Based on this situation, IC Insights predicts that Q4 DRAM prices will fall by 0 to 5%.
The lack of core alleviation signal is beginning to appear
The automotive industry, which has the worst core shortage, seems to have passed the most difficult moment. This has been reflected in many aspects of the automotive industry. Volkswagen’s CFO Arno Antilitz said that he has seen chip supply stabilizing, and Toyota, Nissan, and Honda have also said they will increase production in the near future. A GM spokesperson said that in the first week of November, GM's North American assembly plant did not shut down for the first time due to a lack of cores.
In addition to car manufacturers that can confirm the alleviation of the lack of core, the supply of chips has also eased in 4S stores. Cui Dongshu said that the tight supply of major chips has been improved, and the recovery of passenger car production has generally improved. Under the coordination of relevant departments, the overall performance of the passenger car market has begun to stabilize. The reporter learned that the supply of domestic models under the Jaguar Land Rover brand increased by about 20% compared with the previous few months; Dongfeng Honda's supply in the fourth quarter increased by 50% compared with the third quarter. A number of 4S stores said that “it took more than 2 months to pick up the car before, but the current pick up cycle has been reduced to one to one and a half months.” The reporter learned that some of the popular BBA models are already available in Beijing 4S stores. , At the same time, the preferential strength of domestic popular models has also resumed.
In terms of supply chain, ICViews learned from the general generation level that the shortage of MCUs has been eased. At the same time, the reporter found in many semiconductor supply exchange groups that the supply information of many MCUs that were previously out of stock is gradually increasing.
Among many semiconductor supply exchange groups, STMicroelectronics is no longer scarce.
Some OEM manufacturers are no longer eager to find domestically-made MCU replacements. Some OEDMs said: “In the case of severe core shortage before, the news from the original factory was that the supply or distribution of goods will be in a state of discontinuation before, so they are eager to find localized alternatives. Products; and the current less urgent demand for domestically produced products is mainly due to the gradual resumption of supply after receiving the original notice from the original manufacturer."
There are more solutions than difficulties
Going back to the opening paragraph, major fabs are expanding new plants, and governments around the world are also vigorously encouraging the production of semiconductor companies. Under such a trend, the trend of lack of cores has shown an inflection point.
New markets such as new energy vehicles, Metaverse, 5G and even 6G keep the semiconductor market in high demand; the new economic form represented by the dual-carbon target brings new requirements to the semiconductor industry; the Beijing Stock Exchange can bring small and medium-sized semiconductor companies The coming capital dividend... 2021 is coming to an end. The winter has already passed, can spring be far behind?