Structural shortage tracking of automotive-grade chips: Input-output mismatch affects production momentum

Under the appearance of sufficient supply of many automotive chips, the problem of insufficient supply of some core chips is still affecting the automotive industry. This structural shortage is expected to last until 2025, and this is also an opportunity for chip manufacturers. However, due to the risk considerations of input and output, chip manufacturers have insufficient motivation to actually invest in new production capacity.

According to calculations by AutoForecast Solutions (hereinafter referred to as "AFS"), an automotive industry data forecasting company, global production may be reduced by 3 million vehicles in 2023 due to core shortages. In this regard, some industry experts recently told "Red Weekly" that it will take 18 to 24 months to build a factory and ramp up production of new chip production capacity. It has been less than two months since the "core shortage" phenomenon appeared at the end of 2020. year, which means that new production capacity has not been released, and the demand for superimposed electric vehicles is increasing, and the "core shortage" phenomenon will inevitably continue.

Semiconductor experts in the industry believe that it may take until 2025 for the structural shortage of domestic automotive-grade chips to be substantially resolved. From the perspective of the breakthrough path of local chip manufacturers, the short-term breakthrough point must be the power category. However, judging from the current layout of chip manufacturers, many companies are moving slowly. This is related to problems such as the long development cycle of automotive-grade chip products and the mismatch in input-output ratio.

Investigation on core shortage between traditional car companies and new forces

IGBT and some analog chips are in short supply

In response to the automobile core shortage problem that broke out in the second half of 2020, major global and local chip companies have announced new production capacity. According to the production cycle, these production capacities will be released in the second half of this year. However, according to the observation of "Red Weekly", the current "core shortage" still has a large impact on automobile production.

Toyota recently announced that due to the continued shortage of automotive chips, some production lines at Toyota's three assembly plants in Japan will be suspended. Toyota's global production plan for December will be reduced to 750,000 vehicles, which is approximately 6% lower than the actual production in December last year. According to AFS predictions, due to chip shortages, the cumulative production reduction in the global automobile market will climb to 4.2785 million vehicles by the end of this year. In 2023, the global automobile industry is expected to reduce production by 2 million to 3 million vehicles.

Similarly, local car companies also experience chip shortages. "Red Weekly" called GAC Group as an investor. Relevant staff of GAC Group said, "At present, the main thing is that MCU will be a little nervous." The investor relations activity record of GAC Group in May this year shows that the main shortages of GAC Group include: Chips from Infineon, STMicroelectronics, NXP and other manufacturers.

Compared with last year's comprehensive "core shortage", this year's car-grade chips show a structural shortage. "Red Weekly" called SAIC as an investor. Relevant staff said, "This year's chip shortage is similar to last year's large-scale chip shortage." It’s not quite the same. This year, the main problem is the shortage of chips for different parts. The situation faced by OEMs should be similar.”

Compared with traditional car companies, new car-making forces seem to be less affected by core shortages. "Red Weekly" learned from the sales staff of the new car-making force that "Wei Xiaoli"'s new car delivery is not affected by chips, and the supply of chips is relatively sufficient. "Red Weekly" consulted a Li Auto salesperson in Beijing as a consumer, and he said, "Order Lili L8 and L9 now and they will be delivered before the Spring Festival. Lili Chip has its own factory, which can guarantee the supply chain. There will be no shortage of chips." As a result, vehicle delivery delays occurred. "Xpeng Motors sales staff said that Xpeng's chips are relatively sufficient and the delivery cycle will not be extended due to chip problems. A NIO salesperson said that it is no longer affected by the chip. If you order an ET5, the pick-up period is about five months. The main reason is that the order volume of the ET5 is larger than that of other models, so it takes a long time.

In this regard, Chen Qi, a person in the semiconductor industry, told "Red Weekly" that "the current shortage of automotive electronics is still relatively tight, mainly for on-board MCUs used in ECO (intelligent engine control) systems and power semiconductors such as IGBTs used in electronic control systems. , some analog chips for body control are also in short supply. Relatively speaking, after the subsequent production capacity of power semiconductors such as IGBT and MOSFET is increased, the domestic replacement rate will increase, but the supply and demand of chips such as MCUs and various sensors will still be relatively balanced. We rely on large foreign manufacturers for supply, so it is still relatively tight in the short term. Compared with the beginning of the year, the supply chain has gradually returned to normal, and the most stressful time has passed.”

Chen Haijin, chief analyst of Debon Securities Electronics, told Red Weekly that the current chip shortage among car companies is mainly due to the lack of car-standard power management chips, car-standard MCU chips, car-standard IGBT modules, SiC modules, etc. As the demand for other consumer goods weakens, the production capacity utilization rate of wafer fabs gradually declines, which alleviates the problem of automobile core shortage to a certain extent. At present, the supply and demand of automotive power management chips in some fields have improved, such as car light LED drivers, motor drivers and other chips. However, the supply of MCUs, high-power IGBT modules and SiC modules in some key fields is not yet smooth.

Chen Haijin believes that new car-making forces will be less affected by the core shortage due to their small initial sales. Industry insiders analyzed to "Red Weekly" that the current new car-making forces are not short of chips because the production volume and sales volume are small. When the total volume increases, the chip shortage problem will become more obvious. Because car companies, a new force in car manufacturing, use more high-tech technologies, there is greater demand for some chips.

Domestic substitution process is slow

Power chips are the short-term breakthrough point

The shortage of automotive chips means that this is an opportunity for domestic substitution. A research report from Zhongtai Securities pointed out that the global automotive semiconductor market is expected to exceed US$80 billion in 2025, with a compound growth rate of 15% from 2021 to 2025.

Regarding the use of domestic chips, "Red Weekly" contacted the relevant sales staff of Lantu Automobile, who said that the current chips are cooperating with Huawei. A staff member of the Securities Department of SAIC Motor also said, "We have domestic chip alternatives, but some parts (domestic chips) are still not satisfactory." A staff member of the Guangzhou Automobile Group Securities Department said, "Since the shortage of chips began, we have been working on domestic substitution issues. , will consider using domestic chips. Some chips may also be considered to be supplied by two places, but not all chips can be replaced, because it is not that simple to replace car-grade chips, and a lot of device-level verification is required, especially It involves safety. For example, it takes a year to conduct high temperature and cold tests.”

Liu Yuan told "Red Weekly" that traditional car manufacturers are very conservative and generally do not easily adopt chips from new manufacturers because car companies have higher requirements for chip reliability and stability, and the general testing and certification cycle takes 3-5 years. . Yang Yuxin, chief marketing officer of Black Sesame Intelligence, said, "Most car manufacturers are now certifying local suppliers. Once a supplier is finally trained and mature, the car manufacturers will be less willing to consider replacing it with another domestic supplier. So in 2025, if the chip If you can’t get on the bus, related chip companies may face greater challenges.”

Liu Yuan believes that currently, the automotive industry is in a state of structural core shortage, and some digital chips have gradually eased. However, it may have to wait until 2026 for the shortage of automotive semiconductors to be fully alleviated. Although the "core shortage" has been alleviated, the demand for domestic replacement has always been , suppliers are diversified and multinational, so as to ensure that they are not affected by various uncertainties such as geopolitics. The opportunity for automotive chip manufacturers is to be the first to squeeze in new car brands, because new brands have fewer sources of suppliers.

At present, the automotive semiconductor market is mainly dominated by overseas manufacturers. The rise of domestically produced cars and the accelerated layout of domestic manufacturers have brought opportunities for domestic substitution in various market segments. Due to the wide variety of automotive chips, "Red Weekly" sorted out the layout and production status of chip manufacturers according to the two categories that benefited from electrification and intelligence (see Table 1).

Tianfeng Securities pointed out in a research report that the autonomy rate of China's automotive-grade chips in automotive computing and control chips is less than 1%, sensors are 4%, power semiconductors are 8%, and memories are 8%. Auto-grade MCUs are domestically produced. The rate is about 5%.